Even more information about form 8867 isssues

Here's yet another version of what we might be on our collective horizons. This is a cut-&-paste from the Refund Advantage website. (If this has already been posted, a thousand pardons.)   February 17, 2013 - IRS Delaying Refunds for Some EITC Taxpayers

Last week, the IRS reported that a large number of tax returns containing Form 8867 (Paid Preparers Earned Income Credit Checklist) were submitted with "incomplete" information, particularly during the first week of the filing season. There appears to have been confusion in the opening days of the season as to the exact requirements of this form and of the IRS. This caused confusion for the tax software companies and EROs. In the last few days, the IRS has apparently now begun sending letters to taxpayers in cases where the Form 8867 was not completed to the satisfaction of the IRS. In these letters, the IRS notes that some of the required entries on lines of Form 8867 were missing. What is confusing for the taxpayer is that these lines are supposed to be completed by the tax preparer (not the taxpayer). For example, line 24 is a question to the preparer that asks the preparer "Did you ask this taxpayer any additional questions that are necessary to meet your knowledge requirement?" The letters from the IRS instruct the taxpayer to provide answers to certain questions on Form 8867. The letters go on to tell the taxpayer that if they do not respond to the letter, their refund may be reduced. And, if they do respond, their refund will be issued in about 6 to 8 weeks from the time the taxpayer provides "responses" to the requested lines on Form 8867. The IRS allows taxpayers to provide responses by fax or by mail. Blog posts at various web sites reveal that this problem has affected many preparers nationwide. In these posts, preparers appear frustrated that the IRS has delayed these refunds and sent letters to their taxpayers that seemingly serve to confuse the taxpayers. In most cases, taxpayers receiving the IRS letter mentioned above will have their entire refund temporarily held by the IRS. But in other cases, the IRS may pay the non-EITC portion of the refund, and have delayed only the EITC portion of the refund.