U.S. Individual Income Tax Return

2018

Instructions for Form 8867

Department of the Treasury
Internal Revenue Service

Paid Preparer’s Due Diligence Checklist for the Earned Income Credit, American
Opportunity Tax Credit, Child Tax Credit (including the Additional Child Tax Credit
and Credit for Other Dependents), and/or Head of Household Filing Status
Section references are to the Internal Revenue Code unless
otherwise noted.

Future Developments

For the latest information about developments related to Form 8867
and its instructions, such as legislation enacted after they were
published, go to IRS.gov/Form8867.

What’s New
Form 8867 revised. Form 8867 has been revised to include the
credit for other dependents (ODC) and head of household (HOH)
filing status.
Credit for Other Dependents. The Tax Cuts and Jobs Act
modified the child tax credit (CTC) to provide for a $500
nonrefundable credit for 2018, for qualifying dependents other than
children who can be claimed for the CTC.
Due diligence requirements for HOH filing status. The Tax Cuts
and Jobs Act expanded the due diligence requirements to cover
eligibility to file as HOH.
Penalty. The penalty per failure to be diligent has increased to $520
for returns or claims for refund filed in 2019.
Social security number (SSN) required. Children identified by an
IRS individual taxpayer identification number (ITIN) or adoption
taxpayer identification number (ATIN) no longer qualify for the CTC
or refundable additional child tax credit (ACTC). A taxpayer must
include an SSN valid for employment for each qualifying child for
whom the credit is claimed. However, children without an SSN may
still qualify for the new nonrefundable ODC.

Reminders
Multiple Forms 8867. Multiple Forms 8867 may be submitted
electronically for one return. See Multiple Forms 8867 for one return,
later.
Childless Earned Income Credit (EIC). Your client may be able
to qualify for the EIC under the rules for taxpayers without a
qualifying child if your client has a qualifying child for the EIC who is
claimed as a qualifying child by another taxpayer. For more
information, see Pub. 596.
American Opportunity Tax Credit (AOTC). For information on
eligibility for the AOTC, see Pub. 970.

General Instructions
Form 8867 covers the EIC, the CTC/ACTC/ODC, the AOTC, and/or
HOH filing status. You should check the boxes corresponding to all
benefits actually claimed on the return that you prepared.
Only paid tax return preparers should complete this form. If
you were paid to prepare a return for any taxpayer claiming the EIC,
the CTC/ACTC/ODC, the AOTC, and/or HOH filing status, you must
complete Form 8867 and meet the other due diligence requirements
described later in Purpose of Form.
Form 8867 must be filed with the return. Form 8867 must be
filed with the taxpayer’s return or amended return claiming the EIC,
the CTC/ACTC/ODC, the AOTC, and/or HOH filing status.

Nov 28, 2018

Signing tax return preparers.
• If you are the paid tax return preparer signing the return and you
are filing the return electronically, file the completed Form 8867
electronically with the return.
• If you are the paid tax return preparer signing the return and you
are not electronically filing the return, or mailing the return to the IRS
for the taxpayer, provide the completed Form 8867 to the taxpayer
with instructions to file this form with his or her return.
• If you are the paid tax return preparer signing the return and you
are mailing the return to the IRS for the taxpayer (which should only
be done after the taxpayer has reviewed and signed the paper
return), mail the completed Form 8867 to the IRS with the return.
Nonsigning tax return preparers. If you are the paid tax return
preparer for any of the credits and/or HOH filing status covered by
Form 8867 but you are not required to sign the return as preparer,
provide the signing tax return preparer the completed form in either
electronic or paper format.
You can find rules regarding who is a signing tax return preparer
and a nonsigning tax return preparer in Regulations section
301.7701-15. If you are the only paid tax return preparer for the
taxpayer’s return, you are the signing tax return preparer and must
sign the return as preparer. Failure to sign the return when required
may subject you to a penalty.
Multiple Forms 8867 for one return. Form 8867 must be
completed by a paid tax return preparer responsible for a taxpayer's
claim of the EIC, the CTC/ACTC/ODC, the AOTC, and/or HOH filing
status; therefore, there may be multiple Forms 8867 for one return or
amended return. If there are multiple Forms 8867 for a paper return,
attach all Forms 8867 to the return to be submitted to the IRS. If
there are multiple Forms 8867 for an e-filed return, e-file will accept
transmission of up to four Forms 8867. All Forms 8867 must be
retained as provided in Document Retention, later.
Example. Paid tax return preparer A determined taxpayer T's
eligibility for, and the amount of, the EIC claimed on T's return. Paid
preparer B determined T's eligibility for, and the amount of, the
AOTC claimed on T's return and also signs the return as the signing
tax return preparer. Two Forms 8867 must be completed, one
prepared by A for the EIC, and one prepared by B for the AOTC. The
Form 8867 completed by A as a nonsigning preparer must be
provided to B to be filed along with T’s return. The Form 8867
completed by B as the signing preparer should also be filed with T's
return.

Purpose of Form

As a paid tax return preparer, you are required to exercise due
diligence when preparing any client’s return or claim for refund. As
part of exercising due diligence, you must interview the client, ask
adequate questions, and obtain appropriate and sufficient
information to determine the correct reporting of income, claiming of
tax benefits (such as deductions and credits), and compliance with
the tax laws.
You also must meet specific due diligence requirements set forth
in Treasury Regulations when you prepare returns and claims for
refund involving the EIC, the CTC/ACTC/ODC, the AOTC, and/or
HOH filing status. To meet these due diligence requirements, you
may need to ask additional questions and obtain additional
information to determine your client’s eligibility to claim the credit(s)
and/or HOH filing status and to determine the amount(s) of any
credit(s) claimed. Failure to meet the due diligence requirements

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could result in a $520 penalty for each failure. See section 6695(g)
and Temporary Regulations section 1.6695-2T.
You will have complied with the due diligence requirements
set forth in Treasury Regulations for the EIC, the CTC/ACTC/
ODC, the AOTC, and/or HOH filing status claimed on a return
or claim for refund if you do all of the following.
1. Meet the knowledge requirement by interviewing the
taxpayer, asking adequate questions, contemporaneously
documenting the questions and the taxpayer’s responses on the
return or in your notes, reviewing adequate information to determine
if the taxpayer is eligible to claim the credit(s) and/or HOH filing
status, and to determine the amount(s) of the credit(s) claimed.
2. Complete Form 8867 truthfully and accurately and complete
the actions described on Form 8867 for any applicable credit(s)
claimed and HOH filing status, if claimed.
3. Submit Form 8867 in the manner required.
4. Keep all five of the following records for 3 years from the
latest of the dates specified later in Document Retention.
a. A copy of Form 8867.
b. The applicable worksheet(s) or your own worksheet(s) for
any credits claimed (see Due Diligence Requirements, later).
c. Copies of any taxpayer documents you may have relied upon
to determine eligibility for the credit(s) and/or HOH filing status.
d. A record of how, when, and from whom the information used
to prepare Form 8867 and the applicable worksheet(s) was
obtained.
e. A record of any additional questions you asked regarding
eligibility for the credit(s), the amount of the credit(s), and/or
eligibility for HOH filing status, and the taxpayer’s answers.

As a paid tax return preparer, when determining the taxpayer’s
eligibility to claim a credit and/or HOH filing status and to determine
the amount of a credit claimed on a return or claim for refund, you
must not use information that you know, or have reason to know, is
incorrect. You may not ignore the implications of information
provided to or known by you, and you must make reasonable
inquiries if the information provided to you appears to be incorrect,
inconsistent, or incomplete. You must make reasonable inquiries if a
reasonable and well-informed tax return preparer, knowledgeable in
the tax law, would conclude that the information provided to you
appears to be incorrect, inconsistent, or incomplete. You must also
contemporaneously document in your files any reasonable inquiries
made and the responses to these inquiries.
You must know the tax law for each credit and/or HOH filing
status claimed on a return or claim for refund you prepare and use
that knowledge to ask your client the right questions to get all the
relevant facts to determine your client’s eligibility to claim the
credit(s) and/or HOH filing status and to determine the amount(s) of
any credit(s) claimed.
Example 1. Taxpayer X engages Preparer C to prepare his
2018 federal income tax return. During the intake interview,
Taxpayer X states he is 25 years old, has never been married, and
has two sons ages 12 and 10. X also states that he was
self-employed, earned $12,000 from his lawn care business, and
had no business expenses or other income. Preparer C believes that
X may be eligible for the EIC and the ACTC. But the ages of the
children seem inconsistent with the age of the taxpayer. Additionally,
the taxpayer's claim that he has no business expenses seems
inconsistent with his income. Preparer C must exercise due
diligence to determine whether a credit can be claimed with respect
to the children and whether Taxpayer X meets the earned income
requirements to claim a credit. Because Preparer C is preparing
Taxpayer X’s 1040 for the year, Preparer C would have been
required to exercise due diligence with respect to those items when
preparing the return, and if he or she made the appropriate inquiries
during that process, then no additional questions would be
necessary. However, if he or she did not previously ask about the
ages of the children and the income requirements, Preparer C is
required to make reasonable inquiries. Reasonable inquiries could
include the following.
• Are these your foster sons or adopted sons? If so, were the
children placed in your home for foster care by an authorized
placement agency or court order or were they lawfully placed in your
home for adoption?
• How long did the children live with you during 2018?
• If the taxpayer is not the parent, did any other relative also reside
with these children for more than half the year in 2018?
• How much did you charge to care for each lawn?
• Do you have records of the amount of money you received from
lawn work?
• Did you have any expenses for lawn mowing equipment, fuel, or
other supplies for your business? If not, how did you provide lawn
care services?
• How many lawns did you take care of?

Specific Instructions
Enter the taxpayer’s name as it appears on the return and enter the
taxpayer identification number (TIN) for the taxpayer (primary TIN, if
filing a joint return).
Enter the name and preparer tax identification number (PTIN) of the
paid tax return preparer who determined the taxpayer's eligibility to
claim the credit(s) and/or HOH filing status for which Form 8867 is
being completed and to determine the amount(s) of any credit(s)
claimed, even if the preparer is not the tax return preparer signing
the tax return.

Part I—Due Diligence Requirements

Complete questions 1–8 for all credits and/or HOH filing status for
which you were the paid tax return preparer determining the
taxpayer's eligibility for any credits for which you were the paid tax
return preparer who determined the amount of the credit claimed.

Line 1

You should prepare the 2018 return based on information related to
the 2018 tax year only. If you are preparing a late or amended return
or claim for refund, you should prepare the return based on the
information related to the tax year of the return or claim for refund.

Preparer C must contemporaneously document these inquiries in
his or her files, along with the responses.

Line 2

Example 2. Assume the same facts as in Example 1, except
that Preparer C also prepared X's 2017 return and at that time he or
she was able to verify that the two boys are X's legally adopted
children. When preparing X's 2018 return, C is not required to make
additional inquiries to determine X's relationship to the two boys for
purposes of the requirement that a return preparer must not know, or
have reason to know, that a claim for the ACTC is based on false or
incorrect information.

You must complete the applicable IRS worksheet for the EIC, the
CTC/ACTC/ODC, and/or the AOTC (or your own worksheet that
provides the same information), as well as all required forms and
schedules for each credit claimed on the return for which you are the
paid tax return preparer. You can find the worksheets for the EIC
and the CTC/ACTC/ODC in the instructions for Forms 1040 and
1040NR. The ACTC worksheet can also be found in the instructions
for Forms 1040-SS and 1040-PR. You can find the AOTC worksheet
in the Instructions for Form 8863. Completion of these forms,
schedules, and worksheets assists you in determining the
taxpayer’s eligibility for the credit and the correct amount of the
credit and is required under the due diligence requirements set forth
in Treasury Regulations. If the taxpayer claimed HOH filing status
and did not claim any of the credits, check the “N/A” box.

Line 5

Keep copies of any documents provided by the taxpayer on which
you relied to prepare the return and determine the taxpayer’s
eligibility for the benefits and to figure the amount(s) of the credit(s)
and list the documents in the space provided. See Document
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Retention later, for more information on the due diligence
recordkeeping requirements. You must request documents from the
taxpayer to substantiate his or her eligibility for a tax credit or HOH
filing status only if you did not already do so as part of exercising
due diligence when preparing the return for the particular tax year.

and/or Schedule C and already exercised due diligence at that time.
Additional guidance on Schedule C and the EIC is available as part
of the EIC Tax Preparer Toolkit at EITC.IRS.

The following are examples of documents that you may rely on to
determine a taxpayer’s eligibility to claim the credit(s), and/or HOH
filing status and the amount(s) of any credit(s) claimed. This list is
not all-inclusive and none of these documents are specifically
required to demonstrate eligibility for the credits and/or HOH filing
status.

Part II—Due Diligence Questions for
Returns Claiming the EIC

•
•
•
•
•
•
•
•
•

If a taxpayer is not reporting self-employment income on
Schedule C, check “N/A.”

Line 9

As a paid tax return preparer, you must exercise due diligence to
determine whether a taxpayer meets all of the eligibility
requirements for the EIC. Although lines 9a, 9b, and 9c only ask
three specific questions related to claiming a qualifying child for the
EIC, all of the eligibility requirements for claiming the EIC must be
met. Therefore, your client may not claim the EIC unless all of the
eligibility requirements for the EIC are satisfied, even if you answer
“Yes” to questions 9a, 9b, and 9c.

Residency of a Qualifying Child
School records or statement.
Landlord or a property management statement.
Health care provider statement.
Medical records.
Child care provider records.
Placement agency statement.
Social service records or statement.
Place of worship statement.
Indian tribal official statement.

Line 9a. If your client is eligible to claim the EIC for taxpayers
without a qualifying child, answer question 9a and skip questions 9b
and 9c.

Disability of Qualifying Child

• Statement of medical doctor.
• Statement of other health care provider.
• Statement of social services agency or program statement.

Line 9c—Tiebreaker rules. These rules determine if a taxpayer
may claim a child as a qualifying child for the EIC when the child
meets the definition of a qualifying child for more than one person. If,
under these rules, the taxpayer may not claim a child as a qualifying
child for the EIC, the taxpayer may be able to claim the EIC under
the rules for a taxpayer without a qualifying child.
• If only one of the persons is the child's parent, the child is treated
as the qualifying child of the parent.
• If the parents file a joint return together and can claim the child as
a qualifying child, the child is treated as the qualifying child of both of
the parents.
• If the parents do not file a joint return together but both parents
claim the child as a qualifying child, the child is treated as the
qualifying child of the parent with whom the child lived for the longer
period of time during the year. If the child lived with each parent for
the same amount of time, the child is treated as the qualifying child
of the parent who had the higher adjusted gross income (AGI) for the
year.
• If no parent can claim the child as a qualifying child, the child is
treated as the qualifying child of the person who had the highest AGI
for the year.
• If a parent can claim the child as a qualifying child but no parent
does so, the child is treated as the qualifying child of the person who
had the highest AGI for the year, but only if that person's AGI is
higher than the highest AGI of any of the child’s parents who can
claim the child.
Subject to the rules just described, the taxpayer and the other
person(s) may be able to choose which of them treats the child as a
qualifying child. If the taxpayer allows another person to treat the
child as a qualifying child, the taxpayer is not eligible to claim the
EIC for the same child. Also, generally, EIC claims must be
consistent with claims for other child-related benefits. For examples
and details, see Pub. 596.
In many cases, the taxpayer may be able to tell you whether his
or her AGI is higher than the AGI of the child’s parents or other
person who might also claim the child.

Schedule C
Business license.
Forms 1099.
Records of gross receipts provided by taxpayer.
Taxpayer's summary of income or summary of income provided
by taxpayer.
• Records of expenses provided by taxpayer.
• Taxpayer's summary of expenses or summary of expenses
provided by taxpayer.
• Bank statements to show income and expenses.

•
•
•
•

Line 6

If your client’s return is selected for audit, the IRS may ask your
client to provide documents to show eligibility for the credit(s) and/or
HOH filing status claimed on the return or claim for refund and the
computation of the amount(s) of any credit(s) claimed. The credit(s)
and/or HOH filing status may not be allowed without this information.
You can help your clients be prepared to answer questions about
their eligibility for the credit(s) claimed and the correctness of the
amount(s) of any credit(s) claimed if you help them understand that
the IRS may ask for underlying documentation regarding eligibility to
claim the credit(s) and/or HOH filing status and the computation of
the amount of any credit(s) claimed.

Line 7

Unless an exception applies, if the EIC, the CTC/ACTC, and/or the
AOTC claimed in a prior year was denied for a reason other than a
clerical or math error, a claim for the credit on the taxpayer’s 2018
return will be denied unless Form 8862 is attached to the return. If
the taxpayer is claiming only the ODC this year, and had a claim for
CTC and/or ACTC denied in a prior year, Form 8862 must be
attached to the return. See the Form 8862 instructions for more
information. If the taxpayer claimed HOH filing status and did not
claim any of the credits, check the “N/A” box.

Part III—Due Diligence Questions for
Returns Claiming the CTC/ACTC/ODC

Line 8

The EIC, the CTC/ACTC/ODC, and the AOTC are determined using
information that includes information about the kind and source of
income reported on a taxpayer’s return. For self-employed
individuals, this information is generally reported on Schedule C
(Form 1040) as income from self-employment. To exercise due
diligence when determining eligibility for, and the amount of, the
credit(s) for a self-employed individual, you may also be required to
ask additional questions to determine whether the Schedule C is
correct and complete unless you prepared the individual’s return

As a paid tax return preparer, you must exercise due diligence to
determine whether a taxpayer meets all of the eligibility
requirements for the CTC/ACTC/ODC. Lines 10, 11, and 12 only ask
three specific questions about eligibility for the CTC/ACTC/ODC.
However, your client must meet all of the eligibility requirements for
claiming the CTC/ACTC/ODC. Therefore, your client may not claim
the CTC/ACTC/ODC unless all of the eligibility requirements for
these credits are satisfied, regardless of the answers to the
questions on line 12.

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Line 12

result in a $520 penalty for each failure. For example, if you are paid
to prepare a return claiming the EIC, the CTC/ACTC/ODC, the
AOTC, and/or HOH filing status, and you fail to meet the due
diligence requirements for all of these credits, you could be subject
to a penalty of $2,080.

If the taxpayer is the custodial parent of the child claimed for the
credit and he or she has completed Form 8332 or signed a similar
document containing the same information, which released a claim
to exemption for the child, he or she is not entitled to claim the child
for the CTC/ACTC/ODC.
If the taxpayer is the noncustodial parent and has a Form 8332
(or equivalent document) signed by the custodial parent, you should
determine whether there is a more recent form or document
revoking the release of the claim to exemption for the child. See the
instructions for Form 8332 for more information.

Document Retention

To meet the due diligence requirements for the EIC, the CTC/ACTC/
ODC, the AOTC, and/or HOH filing status, you must keep all of the
following records.
1. A copy of Form 8867.
2. The applicable worksheet(s) or your own worksheet(s) for
any credits that are claimed that are specified in Due Diligence
Requirements, earlier.
3. Copies of any documents provided by the taxpayer on which
you relied to determine eligibility for the credit(s) and/or HOH filing
status.
4. A record of how, when, and from whom the information used
to prepare Form 8867 and the applicable worksheet(s) was
obtained.
5. A record of any additional questions you may have asked to
determine eligibility to claim the credit(s) and/or HOH filing status
and the amount(s) of any credit(s) claimed and the taxpayer’s
answers.

Part IV—Due Diligence Questions for
Returns Claiming the AOTC

As a paid tax return preparer, you must exercise due diligence to
determine whether a taxpayer meets all of the eligibility
requirements for the AOTC and has paid the qualified tuition and
related expenses used to figure the AOTC. Although line 13 only
asks about substantiation of qualified tuition and related expenses,
your client must meet all of the eligibility requirements for claiming
the AOTC. Therefore, your client may not claim the AOTC unless all
of the eligibility requirements for the AOTC are satisfied, even if you
answer “Yes” to the question on line 13.

Line 13

You must keep those records for 3 years from the latest of the
following dates.
• The due date of the tax return (not including extensions).
• The date the return was filed (if you are a signing tax return
preparer electronically filing the return).
• The date the return was presented to the taxpayer for signature (if
you are a signing tax return preparer not electronically filing the
return).
• The date you submitted to the signing tax return preparer the part
of the return for which you were responsible (if you are a nonsigning
tax return preparer).
These records may be kept on paper or electronically in the
manner described in Rev. Proc. 97-22 (or later update). Rev. Proc.
97-22 is on page 9 of Internal Revenue Bulletin 1997-13, which is
available at IRS.gov/pub/irs-irbs/irb97-13.pdf.

Qualified tuition and related expenses. For more information
determining whether expenses meet the definition of qualified tuition
and related expenses, see Pub. 970.
Tuition Statement (Form 1098-T). Consult Pub. 970 and the
Instructions for Form 8863 for procedures that need to be followed to
claim the AOTC if the student did not receive Form 1098-T. Form
1098-T reports the amount the student paid to the institution for
qualified tuition and related expenses during the calendar year, as
well as certain refunds, reimbursements, scholarships, and grants
processed and administrated by the school.
A taxpayer may claim the AOTC only for qualified tuition and
related expenses actually paid during the calendar year. Amounts
reported on the Form 1098-T may not accurately reflect amounts
actually paid for qualified expenses. Therefore, you must verify the
amount of qualified tuition and related expenses actually paid by, or
on behalf of, the student to determine the amount of the AOTC for
which your client may claim the AOTC. For more information on
eligibility for the AOTC and on determining the expenses that qualify
for the AOTC, see Pub. 970, Form 8863, and the Instructions for
Form 8863.

Paperwork Reduction Act Notice. We ask for you to obtain the
information on this form to carry out the Internal Revenue laws of the
United States. You are required to obtain this information.
You are not required to obtain the information requested on a
form that is subject to the Paperwork Reduction Act unless the form
displays a valid OMB control number. Books or records relating to a
form or its instructions must be retained as long as their contents
may become material in the administration of any Internal Revenue
law. Generally, tax returns and return information are confidential, as
required by Internal Revenue Code section 6103.

Part V—Due Diligence Questions for
Claiming HOH
Line 14

As a paid tax return preparer, you must exercise due diligence to
determine whether a taxpayer meets all of the eligibility
requirements to qualify for HOH filing status. Although line 14 only
asks about substantiation that the taxpayer was unmarried (or
considered unmarried) and provided more than half of the cost of
keeping up a home for the year for a qualifying person, your client
must meet all of the eligibility requirements for claiming HOH filing
status. Your client may not claim HOH filing status unless all of the
eligibility requirements for HOH filing status are satisfied, even if you
answer “Yes” to the question on line 14. For more information on
HOH filing status, see your tax return instructions.

The time needed to complete and file this form will vary
depending on individual circumstances. The estimated average time
is:
Learning about the law or the form . . . . . . .
Preparing and sending the form . . . . . . . . .

18 min.
1 hr., 49 min.

If you have comments concerning the accuracy of these time
estimates or suggestions for making this form simpler, we would be
happy to hear from you. See the instructions for the tax return with
which this form is filed.

Part VI—Credit Eligibility Certification
Line 15

Failure to meet the due diligence requirements for claiming the EIC,
the CTC/ACTC/ODC, the AOTC, and/or HOH filing status could

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