Is That Child Yours? The IRS Says Prove it.
Updated: Feb 22
This tax season be prepared to prove your child is yours. IRS Due Diligence Compliance requires your tax preparer to collect additional documentation, especially if you want to claim the Child Tax Credit, so be sure to bring the right documents.
Gone are the days' tax preparers ask you a question concerning your tax returns then entered your "verbal" response, as it was the clients' responsibility to provide documented proof in the event of an audit.
Each year, the IRS Due Diligence Requirements are becoming stricter. The IRS now mandates lengthy due diligence forms as part of the tax return. Preparers must sign to indicate they have collected all required documents before clients' returns can be filed. That is a significant change and a big headache for clients and preparers alike.
For example, if a client qualifies for the $2,000 Child Tax Credit, the client will need to provide proof—that means giving their preparer the child's birth certificate, social security card, medical record, or school record—that ties the child to their parent or caregivers home.
How does the IRS make sure preparers and clients are following the law?
Tax preparers often hear from long term clients, "But you know me, I've never had to provide these documents before!" Well, the IRS now mandates taxpayers to do so, and there are severe consequences for non-compliance. Avoid being flagged for an audit by the IRS, which is time-consuming and expensive, and provide the tax preparer with the documents needed.
The tax benefits most affected include:
Child Tax Credit (CTC), including Additional Child Tax Credit (ACTC)
For more information, click the links above to visit the IRS website.