Stand out as a trusted tax professional: A guide to prepare accurate refundable tax credit returns for your clients - YouTube video text script

Good day, and hello and welcome to today’s webinar, Stand Out as a Trusted Tax Professional! A Guide to Prepare Accurate Refundable Tax Credit Returns for Your Clients! I see it is the top of the hour and we’re so glad you’ve joined us today. My name is Christopher Green and I am a Stakeholder Liaison with the Internal Revenue Service. I will be your moderator for today’s webinar, which is slated for approximately 60 minutes.

But before we begin, if there is anyone in the audience that is with the media, please send an email to the address on this slide. Be sure to include your contact information and the news publication you’re with. Our Media Relations and Stakeholder Liaison staff will assist you and answer any questions you may have. As a reminder, this webinar will be recorded for future viewing.

If you are just joining us, I want to quickly mention some virtual webinar housekeeping items. Number one, Closed Captioning is available for today’s presentation and will be available throughout the webinar. Secondly, you can download several documents by clicking on the materials dropdown arrow on the left side of your screen as shown on this slide. We’ve included technical help documents along with a copy of today’s PowerPoint. And lastly, if you have a topic-specific question today, please submit it by clicking the Ask Question dropdown arrow to reveal the text box. Type your question in the text box and click Send. And please do not enter any sensitive or taxpayer-specific information.

Now, during the presentation, we’ll take a few breaks to share knowledge-based questions with you. And at those times, a polling-style feature will pop-up on your screen with a question and multiple-choice answers. Select the response you believe is correct by clicking on the radio button next to your selection and then click Submit.

If you do not get the polling question, this may be because you have your pop-up blocker on. So, please, take a moment to disable your pop-up blocker now so that you can answer those questions. We’ve included several technical documents that describe how you can disable pop-up blockers based on the browser you are using. You can access them by clicking on the materials dropdown arrow on the left side of your screen.

And with that being said, we’re going to take some time and test the polling feature now. So, here’s your opportunity to ensure your pop-up blocker is not on, so you can receive the polling questions throughout today’s presentation. Audience, this example polling question will count towards the polling question requirements to earn CE credit.

And here’s your question. Do you know who your local stakeholder liaison is? Is it A, yes; B, no; or C, what is a stakeholder liaison? Take a moment and click the radio button that corresponds to your answer. And again, the question is, do you know who your local stakeholder liaison is? Is it yes, A; B, no; or C, what is a stakeholder liaison? I’ll give you a few seconds to make your selection now.

Okay. Audience, we’re going to stop the polling now. Let’s see how the majority of you responded. Okay. So, I see that the majority of you actually chose the letter A at 86% rate. So, that’s awesome. You know who your stakeholder liaison is. But for those of you that selected B or C, I encourage you to visit IRS.gov and enter in the search bar stakeholder liaison, okay? You should see a link for your stakeholder liaison local contacts that should take you to our page to learn more about our role as a collaborative outreach champion and how to reach your local SL. We hope you received the polling question and were able to submit your answer. But if not, now is the time to check your pop-up blocker to make sure you have it turned off.

And again, welcome. We’re glad you joined us for today’s webinar. Before we move along with our session, let me make sure you’re in the right place. Today’s webinar is Stand Out as a Trusted Tax Professional! A Guide to Prepare Accurate Refundable Tax Credit Returns for Your Clients! This webinar is scheduled for approximately 60 minutes from the top of the hour.

So with that, now is the time I will introduce our presenters. We have Ms. Roberson, who is a Program Analyst in Return Integrity and Compliance Services with over 18 years of experience at the IRS. She began her career in public accounting as an Auditor and Accounting Manager and has since specialized in refundable credits, advancing compliance, and practitioner outreach initiatives. And also we have Brian Sartain, who is a Senior Tax Analyst in Return Integrity and Compliance Services as well. And he has been with the IRS for 35 years and more. He has held numerous positions, including Collections Manager, Revenue Officer, and Senior Technical Advisor, and of course his current position as a Senior Tax Analyst.

And with that, I’m going to turn over the mic to Ms. Roberson to begin our presentation. The floor is now yours.

Thank you so much, Chris. I appreciate the introduction and I want to take this time to thank everyone for joining today. I hope everyone’s having a wonderful day so far. So today’s presentation is Stand Out as a Trusted Tax Professional! A Guide to Prepare Accurate Refundable Tax Credit Returns for Your Clients! By the end of this webinar, you will know the 2025 eligibility rules for tax returns claiming; Earned Income Tax Credit, EITC; Child Tax Credit; Additional Child Tax Credit; and Credit for Other Dependents, also known as CTC, ACTC, and ODC. The American Opportunity Tax Credit, AOTC; and Head of Household, HOH, filing status.

Then, we will demonstrate how these credits impact a young adult living with a parent when they want to file independently and claim credit, and how they should determine dependency status. Additionally, before we end our presentation today, we will share some useful online resources and other educational tools available at IRS.gov. These resources will help with questions you might have about refundable credits and your responsibilities as tax professionals when claiming these benefits for your clients.

Okay, let’s start with our first topic, the Earned Income Tax Credit. Before I start, I’d like to pose a rhetorical question. What is the main requirement to be eligible for the Earned Income Tax Credit? You may have guessed it, earned income. Obvious, right? Now, let’s dive into the Earned Income Tax Credit eligibility rules. I’ll start with a general overview of the EITC rules for everyone. For starters, your client must have a valid Social Security Number issued by the due date of the tax return. The Social Security Number is valid for the EITC unless it was issued after the due date of the tax return, including extension, or it was issued solely to apply for or receive a federally funded benefit and does not authorize your client to work.

Your client must also be a U.S. citizen or resident alien for the entire year. In addition, your client must file a joint return if they are married unless they meet certain rules, such as being separated from their spouse. A married client who filed as Head of Household or married filing separately could claim EITC only if they had a qualifying child living with them for more than half the year and either lived apart from their spouse for the last 6 months of the year or were legally separated according to their state law under a written separation agreement or decree of separate maintenance and did not live in the same household as their spouse at the end of the year.

So far, I’ve tackled a few key EITC eligibility rules. I’ll now move on to the rest. The remaining four rules say your client must have an adjusted gross income less than the applicable limit. They cannot file Form 2555, Foreign Earned Income. They must have investment income of $11,950 or less, and this amount is adjusted for inflation each year. And the last rule states that your client must have earned income, as I mentioned at the start of our webinar.

Here’s a helpful hint. You can find more information about Form 2555 in Publication 54 titled Tax Guide for U.S. Citizens and Resident Aliens Abroad on IRS.gov. Generally, if you need to look up any prior or current tax year EITC amount, AGI limitation, or investment income limitation, this information is also available on IRS.gov Publication 596. I just discussed the EITC eligibility rules that apply to all taxpayers.

Now let’s turn our attention to the EITC eligibility rules for taxpayers who have a qualifying child. The EITC eligibility rules for taxpayers with qualifying children are as follows. Your client’s qualifying children must meet the relationship, age, residency, and joint return test. A qualifying child cannot be claimed by more than one person. Your client cannot be a qualifying child of another taxpayer. I would like to note it is possible for a child to be the qualifying child of more than one person. And if this situation arises, you may need to apply the tiebreaker rule, which I will discuss later in this session.

For now, let’s continue our review of the eligibility rule for taxpayers with a qualifying child. As I just mentioned, your client’s qualifying children must meet the relationship, age, residency, and joint return test. Now some of you may think that these tests are easy to discuss with your clients. However, I’m sure there are just as many of you who have encountered numerous scenarios that highlight just how challenging this task can be.

If you can relate to this, we have several online resources you can use. For example, Publication 4687, Paid Preparer Due Diligence, which includes some great scenarios to help you navigate these types of discussions. Again, Publication 596, Earned Income Credit, which provides everything you need to know about EITC. Specifically, refer to Chapter 2, Rules if You Have a Qualifying Child, for more information about eligibility rules for qualifying children. And you can also find information on the IRS website. Simply enter qualifying child rules in the search box for more detail.

Now it’s time for you to participate. I have a poll question for you. Let’s test your knowledge.

Back to you, Chris.

Perfect, Ms. Roberson. Our first polling question states, your client wants to claim their child, Jodi, as a qualifying child for the Earned Income Tax Credit in 2025. Jodi turned 19 on December 10, 2025. Jodi graduated high school in 2024 and was a college student for 4 months during 2025. Jodi did not work. Is Jodi a qualifying child for the Earned Income Tax Credit? Here’s your answers. Is it A, no, although Jodi was under 24 at the end of the year, she was not a full-time student for at least 5 months of the year. Or B, yes, Jodi was 19 years old, a full-time student for most of the year and lives with your client. Furthermore, she did not work. Or C, yes, Jodi is being claimed on your client’s tax returns, so she is automatically a qualifying child for the EITC.

Take a moment and click on the radio button that answers the question. If you do not receive the polling question, please enter only the letters A, B, or C that corresponds with your response in the Ask Question text box. Your response is a timestamped. So audience, please remember that you need to answer at least three polling questions and participate in the live broadcast from the official start time for at least 50 minutes to earn one IRS CE credit. The polling question example we did at the beginning of the presentation will count towards the requirement. So, I’ll give you a few more seconds to make your selection or if you need to submit your answer in the Ask Question feature, you can do so now.

Okay, audience, we’re going to stop the polling now and we’re going to share with you the correct answer on the next slide. And of course, as you can see, the answer is no, although Jodi was under 24 at the end of the year, she was not a full-time student for at least 5 months of the year. So, let’s see how well you all did with this question. All right, let me go ahead and check here and I can see that you all answered at 84% correctly. You responded at 84% correct. That’s awesome correct response rate.

So Ms. Roberson, they’re listening. I’ll turn it back over to you now.

Thank you, Chris. And great job, everyone. Now, let’s talk about the EITC eligibility rule for married taxpayers not filing a joint return. If your client is married and not filing a joint return, they qualify to claim EITC only if they had a qualifying child who lived with them for more than half of the tax year and they meet one of the following criteria. They lived apart from their spouse for the last 6 months of the tax year for which EITC is being claimed; or they are legally separated according to their state law under a written separation agreement or decree of separate maintenance and did not live in the same household as their spouse at the end of the tax year for which EITC is being claimed.

This change under the American Rescue Plan Act impacts all married people who don’t file a joint return, including clients filing as married filing separately and married clients filing as Head of Household.

Now, how about I test your knowledge with another poll question. Chris, back to you.

Okay, Ms. Roberson. That was quick. Audience, it looks like Ms. Roberson is testing your knowledge back to back.

Our second polling question states, Jane is married to Rick. However, Rick moved out in February of 2025 and filed for divorce and since then, Jane has been caring for her older brother who is a qualifying relative. Jane and Rick are not legally separated under a separate maintenance agreement and Jane has worked part-time and supported herself since Rick moved out, earning about $12,000 for the year. She will not file a joint return with Rick. Can Jane claim the EITC for herself and her qualifying relative? Is your answer A, yes, Jane can file as married filing separately and claim the Earned Income Tax Credit since she and her husband lived apart for more than half of the year. Or is it B, no, Jane must file married filing separately and cannot claim EITC. Furthermore, the dependent is not a qualifying child and is a qualifying relative. Or is your answer C, yes, since Jane is in the process of a divorce and does not live with Rick, she can file single and claim the EITC.

Take a moment, reread the question, and click on the radio button that best answers the question. If you do not receive the polling question, please enter only the letters A, B, or C that corresponds with your response in the Ask Question text box. Your response is timestamped. So, I’ll give you a moment to make your selection or submit your answer in the Ask Question feature now. And I hope that you have been able to answer that question.

We’re going to go ahead and stop the polling and then we’re going to share that on the next slide the correct answer for you. All right. And as you can see, the correct answer is B, no, Jane must file married filing separately and cannot claim the EITC. Furthermore, the dependent is not a qualifying child and is a qualifying relative. So with that, let’s see how you did on this question. And I’m seeing from our back office team here that 82% of you have responded correctly. So that is very good. Excellent job.

Ms. Roberson, it looks like the audience is paying attention. So I will turn it back over to you to go over the rules for taxpayers without a qualifying child.

Thanks again, Chris. Great job once again, everyone. For tax year 2025, taxpayers without a qualifying child must meet the basic EITC qualifications and the following additional rules to claim EITC. They must be at least age 25, but under age 65. Note that either spouse can meet this criteria if filing a joint return. They cannot be the dependent of another person and they cannot be the qualifying child of another person. And they must live in one of the 50 states or the District of Columbia for more than one half of the tax year. This rule applies to both spouses if married filing jointly. And just to be aware that there are exceptions that exist for those serving in the military who were on extended active duty outside the U.S. And that’s it.

So, let’s discuss the EITC tiebreaker rules I briefly mentioned earlier. The EITC tiebreaker rules apply when more than one person has the same qualifying child. Naturally, the tiebreaker rules do not apply if the other qualifying person is your client’s spouse and they are filing a joint return. To determine which person can treat the child as a qualifying child to claim the EITC, the following rules apply. If only one person is the child’s parent, the child is treated as the qualifying child of the parent. If the parents file a joint return, the child is treated as the qualifying child of the two parents. If the parents don’t file a joint return but both parents claim the child as a qualifying child, the IRS will treat the child as the qualifying child of the parent with whom the child lived for the longer period during the year.

If the child lived with each parent for the same amount of time, the IRS would treat the child as the qualifying child of the parent who had the higher adjusted gross income or AGI for the year. If no parents 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. And, if the parent can claim the child as a qualifying child but no parent claims the child, the child is treated as the qualifying child of the person who has the highest AGI for the year, but only if the person’s AGI is higher than the highest AGI of any of the child’s parents who can claim the child. If you would like more information about tiebreaker rules Publication 596, Earned Income Credit is on IRS.gov and it’s a great resource.

Let’s move on to our third poll question. This is about who can guess. That’s right, the tiebreaker rules. So back to you Chris.

This is great information audience and now it’s time to roll into our third question and as you can see on your screen we have Tasha. She is 25 years old and lives with her 2-year-old son, Jackson, and her parents. Shortly after Jackson was born, his father passed away. Tasha’s adjusted gross income is $25,000 and her parents adjusted gross income is $22,000. Everyone has a valid Social Security number. Who can claim Jackson as a qualifying child for the Earned Income Tax Credit? Is it A, Tasha’s parents because she and her son live with them all year; or B, Tasha can choose to let her parents claim Jackson; or maybe it’s C, Tasha, she is Jackson’s mother and her adjusted gross income is higher than her parents; well finally, your answer may be D, Tasha’s parents because their earned income will qualify for more EITC credit.

Again your response is timestamped. So take a moment and click the radio button that best answers the question. And, again, if you do not receive the polling question, please enter only the letter A, B, C, or D that corresponds with your response in the Ask Question text box. And with that, I’ll give you a few seconds to make your selection and to submit your answer in the Ask Question feature. Take your time.

Okay, audience, we’re going to stop the polling now and, of course, share with you the correct answer on our next slide. And our correct answer is going to be C, Tasha is the one that’s going to claim it, because she is Jackson’s mother and her adjusted gross income is higher than her parents. So, let’s see how you did on this particular question and I can see here that 91% of you responded correctly. That’s fabulous. That’s outstanding and that’s a wonderful response rate.

So Ms. Roberson, it seems the audience is still with us. So, I’ll turn it back over to you.

Thank you, Chris, an excellent job everyone. That wraps up our discussion on the Earned Income Tax Credit. Let’s move on to the Child Tax Credit, Additional Child Tax Credit, and Credit for Other Dependents.

I will start with the eligibility rule for the Child Tax Credit and Additional Child Tax Credit. Like EITC, it’s important to ask your clients adequate questions to make sure they qualify for these credits. This is especially true with the recent passage of the One Big Beautiful Bill. For the Child Tax Credit, or CTC, the bill expanded identification requirements to claim the credit beginning tax year 2025. The taxpayer or at least one spouse if filing jointly must provide a work eligible Social Security number to claim the Child Tax Credit. Additionally, the bill increased the maximum amount of the credit to $2,200 per qualifying child and the amounts will adjust annually with inflation beginning 2026.

Furthermore, the bill makes permanent the refundable portion of the credit and the phase out threshold of $200,000 or $400,000 for joint filers. As expected, there are some rules to consider for the qualifying child. For starters, just like the taxpayer or their spouse, the qualifying child must have a work-eligible Social Security number. The qualifying child must also be under 17 years old at the end of the year, and they must be a U.S. citizen, U.S. national, or a resident of the United States. The qualifying child generally lives with the taxpayer for more than half of the tax year. They must not file a joint return with their spouse for the tax year unless it is only to claim a refund of withheld income tax or estimated tax paid. They must not provide over half of their own support for the tax year.

And the qualifying child must be the taxpayer’s son, daughter, stepchild, eligible foster child, brother, half-brother, sister, half-sister, stepbrother, stepsister, or a descendant of any of them. And, of course, they must qualify to be claimed as a dependent on the return. As a reminder, the taxpayer should use Schedule 8812, Credits for Qualifying Children and Other Dependents, to calculate the credit.

Okay, let’s move on to our next poll question on the Child Tax Credit. Back to you, Chris.

Perfect. And, audience, can you believe it? We’re at our fourth and final poll question, and your question states this. Which of the following taxpayers, all of whom have two qualifying children under 17 for the purposes of the Child Tax Credit, are eligible to claim $2,200 CTC per child on their tax return? Is it A, Fiona, who is married filing separately with an adjusted gross income of $78,000? Is it B, Ken, who is a qualifying surviving spouse with an AGI of $500,100? Or C, Nick, who is single with an adjusted gross income of $70,000? Or D, Julie, who is married filing jointly with an AGI of $422,000? Or maybe your answer is E, Fiona and Nick.

Click on the radio button that best answers the question, or if you do not receive the polling question, please enter only the letters A, B, C, D, or E that corresponds with your response in the Ask Question text box. And, again, your response is timestamped. So, I’ll give you another moment to make your selection and submit your answer in the Ask Question feature, and we’ll move on. Take your time. This is a hard one.

All righty, audience, we’re going to stop the polling now. Hope you got your answer in, and we’ll share the correct answer on our next slide. And as you can see on your screen there, or maybe you’re listening in, the correct answer is E for Fiona and Nick. So, let’s see how well you did on this final question. I believe it was a hard one, but I can actually see here you all responded at 88% correctly, so you guys are just blowing it out of the ballpark. Awesome job, audience. That is an impressive response rate.

Now, Ms. Roberson, I think we can move on now.

Wonderful, Chris, thank you, and great job, everyone. Now that I’ve discussed the Child Tax Credit, let’s go over the eligibility rules for the Credit for Other Dependents, ODC, for a qualifying person. ODC can provide up to a $500 non-refundable tax credit per dependent. However, ODC cannot be claimed for anyone who is eligible for the CTC. This credit can reduce or, in some cases, eliminate a tax bill. However, the IRS does not refund the taxpayer any portion of the credit that may be left over. Your client can claim ODC if they can claim the person as a dependent, the dependent is a U.S. citizen, U.S. national, or resident of the United States, and the dependent cannot be claimed for the CTC or additional CTC.

As I mentioned earlier, a qualifying child for the CTC requires a Social Security number valid for employment. However, the qualifying person for ODC can have a Social Security number, including one not valid for employment; an Individual Taxpayer Identification Number, ITIN; or an Adoption Taxpayer Identification Number, ATIN. These numbers must be issued by the due date of the tax return, including extension. The credit begins to phase out when the taxpayer’s income exceeds $200,000. For married couples filing a joint tax return, the phase out begins at $400,000.

Now that I have discussed all these credits, I will briefly bring up the Head of Household, HOH, filing status. For the HOH filing status, your client must be unmarried or legally separated under state law as of the last day of the tax year. Exceptions treat some married filers as unmarried if they lived apart from their spouse for the last 6 months of the year or their spouse was a non-resident alien during the year. They must have paid more than half the cost of keeping up a home for the year.

This includes expenses such as rent, mortgage interest, property taxes, utilities, and groceries. And they must have a qualifying person live with them in the home for more than half the year, except for temporary absences such as school. This can be a child, parent, or other relative who meet certain criteria. However, if the qualifying person is your client’s dependent parent, the dependent parent doesn’t have to live with them.

If your client meets these requirements, they can file as Head of Household, which offers favorable tax rates and a higher standard deduction compared to the single-family status. So far, we’ve covered the eligibility requirements for the Earned Income Tax Credit, Child Tax Credit, Additional Child Tax Credit, Credit for Other Dependents, and Head of Household filing status.

Now, let me turn the remainder of the presentation over to my colleague. The floor is yours, Brian.

Thank you, Ms. Roberson. I would like to take a second to go over a scenario involving some of the credits that we just covered. Our scenario is about a tax professional educating a young first-time filer about refundable credits and the appropriate filing status to claim the credit. The first-time filer, Christine, is a 22-year-old college student that works at a hardware store and lives with her mother and two siblings. She wants to claim her brother, who is 11, and sister, who is 13, as dependents for Earned Income Tax Credit and the Child Tax Credit. Additionally, because Christine is the only person working, she wants to file as Head of Household.

Now, as part of their due diligence, the tax professional asks Christine about her earnings, household income and expenses, living arrangements, and the amount of financial support she provides to the household. The purpose of the probing questions is to get information about the household arrangement and the total cost that Christine’s family incurs to live. Now, with all the information Christine provided, the tax professional informed Christine that she did not contribute more than half the cost of keeping up the home and, therefore, could not file as Head of Household. Additionally, the tax professional informed Christine that she did not qualify to claim her siblings for the EITC or CTC, because Christine was a qualifying child of her mother.

Now, as a general reminder, for a taxpayer to file as Head of Household, they must pay for more than half the cost of home upkeep, they must be unmarried, legally separated, or considered unmarried under certain exceptions, and they must have a qualified person that lived with them for more than half the year or a dependent parent that did not live with them. For a taxpayer to claim EITC, the qualifying children must have a valid Social Security Number, must meet the relationship, age, residency, and joint return tests, they cannot be claimed by more than one person, and they cannot be the qualifying child of another taxpayer.

And then finally, for a taxpayer to claim CTC, the qualifying children must have a valid Social Security Number, must be a U.S. citizen, U.S. national, or U.S. resident, they must meet the relationship, age, residency, joint return, and support tests, and they must qualify to be claimed as a dependent on the return.

All right, let’s move on to our final credit, the American Opportunity Tax Credit, and then we’ll continue with this scenario. The American Opportunity Tax Credit, or AOTC, is a tax credit to help pay for education expenses for the first 4 years of post-secondary education. The amount of the credit is 100% of the first $2,000 of paid qualified education expenses, and 25% of the next $2,000 of paid qualified education expenses for each qualified student.

Now, your client can claim AOTC even if they paid for the expenses with a student loan, and they can receive a maximum credit of $2,500 per eligible student, and of this amount, 40% or $1,000 is refundable even if they owe no tax. Now, the AOTC is phased out if your client’s modified adjusted gross income exceeds certain levels. The AOTC amount is reduced when the modified AGI is more than $80,000, but AOTC is not allowed when the modified AGI is $90,000 or more, and these income amounts are doubled for joint filers, so joint filers can claim a reduced AOTC when their modified AGI is more than $160,000, but they may not claim AOTC if the modified AGI is $180,000 or more. And also, AOTC is not available to taxpayers who are married filing separately.

So, next, let’s cover who qualifies as a student for the AOTC. So who is eligible for the American Opportunity Tax Credit? The student can be the taxpayer, their spouse, or a dependent listed on the return. To be eligible for the AOTC, the student must be pursuing a degree, certificate, or other recognized education credential, they must be enrolled at least half-time for at least one academic period beginning in the tax year, they must not have completed the first 4 years of higher education at the beginning of the tax year, they must not have been claimed for the AOTC or the former Hope Credit for more than four tax years, and they must not have a felony drug conviction at the end of the tax year.

Now, please note that schools determine academic periods. An academic period can be semesters, trimesters, quarters, or any other period of study such as a summer school session. For schools that use credit hours and do not have academic terms, the payment period may be treated as an academic period.

So, now that we’ve reviewed the eligibility requirements for the American Opportunity Tax Credit, let’s continue our scenario where the paid tax professional is answering Christine’s questions about the AOTC. Now as we know, Christine is a 22-year-old college student that works at a hardware store and lives with her mother and two siblings. We learned that Christine did not contribute more than half the cost of keeping up the home and, therefore, could not file as Head of Household. Also, although she wanted to claim her 11- and 13-year-old siblings for EITC and CTC, she could not do so because Christine was a qualifying child for her mother. But Christine is not giving up on receiving some kind of refund. Because she is a college student, she asks the tax professional whether she can claim the American Opportunity Tax Credit.

The tax professional asks Christine additional information about her enrollment status, whether this is her first time attending college, how she is paying for her education, did she receive Form 1098-T from her college, and whether she has any felony drug convictions. Again, the tax professional is practicing due diligence by asking probing questions to get a clear picture on whether Christine may be eligible to claim the AOTC.

Now, based on all the information Christine provided, the tax professional informed Christine that she could not claim the AOTC. However, the tax professional advised that Christine’s mother file an AOTC claim because Christine is her dependent. If Christine’s mother did so, her mother may receive the refundable portion up to $1,000 if her mother does not owe any other taxes on her return. The tax professional noted that if Christine’s mother did not file a return, then Christine could file a return to claim the AOTC, but Christine would not be eligible for the refundable portion because she is under 24 and has a living parent who provided most of her support.

Generally, a student claiming the AOTC for themselves will not qualify for a refundable amount of the credit if they were under age 18 at the end of the year, if they were age 18 at the end of the year and their earned income was less than half of their own support, they were between 18 and 24 at the end of the year, they were a full-time student and their earned income was less than one half of their support, at least one parent was alive at the end of the year, and finally, they were filing a return as single, Head of Household, qualifying surviving spouse, or married filing separately.

Now, our scenario showed that Christine had a lot to learn. She expected that she could claim Head of Household because she is the only person working. She also expected that she could claim her younger siblings for the EITC and CTC, and she certainly expected that she could claim the AOTC for herself because she attended college. Fortunately, the tax professional asked probing questions and clarified that there are other factors to consider when filing as Head of Household or for refundable credits overall.

I know that was a lot of information, but I appreciate all your attention. This concludes our discussion on the eligibility rules for the Earned Income Tax Credit, Child Tax Credit, Additional Child Tax Credit, Credit for Other Dependents, the American Opportunity Tax Credit, and the Head of Household filing status, but I’m not done yet. As we mentioned at the start, we’re going to share some useful online resources and other educational tools that are available on irs.gov to help with any questions you might have about refundable credits.

The IRS provides helpful tools for determining eligibility when claiming EITC or the other refundable credits that we reviewed earlier. Some examples of useful tools that can assist you are the EITC Chat Bot, the EITC Assistant, the Interactive Tax Assistant, and the Form 886-H-EIC Toolkit.

The EITC Chat Bot is a resourceful tool that’s designed to answer frequently asked questions about eligibility. The EITC Assistant helps you determine whether you qualify for the credit and estimates the potential refund amount. The Interactive Tax Assistant provides answers to several tax law questions specific to an individual circumstance. It can determine filing status, whether income types are taxable, and whether a taxpayer is eligible to claim certain credits or deductions. Some of the credits include the Child Tax Credit, Credit for Other Dependents, and education credits.

And the Form 886-H-EIC Toolkit is a great resource if your client finds themselves under audit for EITC issues and they’ve received letters or notices from the IRS. This tool provides a list of documents that will need to be submitted to show that their children meet the relationship, age, and residency tests to verify EITC eligibility.

And then finally, we’ll discuss some other IRS resources and tools that are available for you, the tax professional. In general, IRS.gov is your resource for all information related to refundable credits. For example, if you’d like more information about Earned Income Tax Credit, just simply enter EITC in the search box. From there, you can find information on the credit, access the EITC Assistant, find benefit comparison charts, and more.

Additionally, there’s the Tax Professionals webpage, which serves as a central hub, providing essential links to topics that are going to be relevant to this audience. This page offers guidance on compliance, strategies for effectively serving clients, contact information for tax-related services, and resources on e-filing. To access this page, enter Tax Professionals in the search box. And as a reminder, if you’re on our Tax Professionals webpage and want additional assistance, be sure to use our chat bot.

Now, also the IRS hosts other webinars on tax and IRS-related topics. Many of these webinars offer continuing education credits. To find the current offerings, visit IRS.gov and type Webinars in the search box.

And then finally, the Tax Preparer Toolkit is an excellent resource to use to meet your due diligence responsibilities. It provides information on due diligence requirements, articles, publications, examples of various letters, and up-to-the-minute compliance messaging. We call them hot topics.

In addition, the IRS offers a free online due diligence training tool called the Due Diligence Training Module. And you can now earn two continuing education credits if you complete the training module and pass the test.

So, thank you for attending today’s webinar. Stand Out as a Trusted Tax Professional! A Guide to Prepare Accurate Refundable Tax Credit Returns for Your Clients! If you have any questions after today’s session, you can email us at EITC.program@irs.gov. And remember to visit IRS.gov for information about refundable credits. Thanks again for attending today’s webinar.

Yeah, thanks a lot, Brian. Hello again, folks, we’ve made it to the fun part, our live question-and-answer, and I’ll be moderating this session. We don’t have much time, but we want to get to it and get to it quickly. We want your answers to be answered fast.

But before we start, I want to thank everyone for attending and staying engaged during today’s presentation, which is Stand Out as a Trusted Tax Professional! A Guide to Prepare Accurate Refundable Tax Credit Returns for Your Clients! Okay. So, here’s your opportunity. If you have not input your topic-related question, there’s still time. Go ahead and click on the dropdown arrow next to the Ask Question field, type in your question, and click Send. Okay. Brian is going to be staying on with us, and he will be answering some of your questions.

So, let’s go ahead and get started so we can get to as many of your questions as time allows. You ready, Brian?

Yes.

Q: All right. First question I see here is, can parents choose who claims the child under the EITC tiebreaker rules?

Okay. Now, unfortunately, the tiebreaker rules are mandatory, so they may not choose.

Q: Very good. Very good. Next question here I have is, can a taxpayer e-file with a dependent who was previously claimed if they use an IP PIN?

Yes. With a valid IP PIN, the IRS now allows e-filing even if the dependent was claimed elsewhere.

Q: Awesome. Another attendee says, can the American Opportunity Tax Credit be used for trade or vocational school?

Oh, that’s an excellent question. I hear that one a lot. Yes, if the school is accredited and eligible for federal student aid, the AOTC is qualified.

Very good. Very good. And I can see that we don’t have much more time for any of the audience’s questions. So that’s all the questions that we can answer at this particular point.

So I want to give a big thank you to Brian for answering those questions and sharing his knowledge, and Ms. Roberson for her partnership and expertise in today’s presentation.

But before we close the Q&A session, Brian, what are some key points you want our attendees to remember from today’s webinar?

Okay. Well, there’s some key points to take away from today’s webinar for EITC and CTC here listed on the slide. One of the key ones to take away is for EITC and CTC, the Social Security Number must be a work-eligible SSN. Now for ODC, the dependent being claimed has to have a TIN, but this can be a Social Security Number, an ITIN, or an ATIN. And additionally, a qualifying dependent for the ODC can be over 16 years old.

And then on the next slide, we’ll see some key points here to remember for the HOH. If your client meets these requirements, they can file as Head of Household, which is going to offer a favorable tax rate and a higher standard deduction compared to the single filing status. And for the AOTC, the American Opportunity Tax Credit, there’s a maximum credit amount of $2,500, and $1,000 of this can be fully refunded if your client does not have any federal tax liability. And this credit can be claimed for the taxpayer, their spouse, or their dependent, if any, who meets the requirements to take the AOTC.

Audience, that is our time for today. I thank you for your participation. And Chris, back to you.

All right. Thank you so much, Brian. Very helpful information. I know the audience really appreciates it. Audience, we are actually planning webinars throughout 2026, as Brian mentioned. And to register for any upcoming webinars, please visit IRS.gov, keyword search, webinars, and select the webinars for tax practitioners or webinars for small businesses. When appropriate, we will offer certificates and CE credit for upcoming webinars, okay?

Currently, we have our next webinar scheduled for Wednesday, January 21, 2026 at 2 p.m. Eastern Standard Time, okay? We invite you to visit the IRS YouTube page at www.youtube.com/irsvideos. There you can view available recorded versions of our webinars and other key video messaging once posted. And again, continuing education credits or certificates of completion are not offered if you view an archived version of any of our webinars.

Another big thank you to our presenters for a great webinar. I also want to thank you, our attendees, for attending today’s webinar, Stand Out as a Trusted Tax Professional! A Guide to Prepare Accurate Refundable Tax Credit Returns for Your Clients!

And remember, if you attended today’s webinar for at least 50 minutes after the official start time and answered at least three polling questions during the live broadcast, you will receive a certificate of completion for one IRS continuing education credit. Remember, the polling question example will count towards the minimum question response requirement. Certificates of completion will be emailed to the registration email address of qualifying participants as a PDF attachment. The email will come from the email address seen on this side. So please add this email address to your contact to ensure you receive the email with the certificate attached.

If you qualify for IRS continuing education credit for this webinar and registered with your valid first name, last name, and Preparer Tax Identification Number as it appears in your IRS PTIN account, your CE credit will be posted in your IRS PTIN account. If you are eligible for continuing education from the California Tax Education Council, your credit will be posted to your CTEC account as well. And if you qualify and have not received your certificate and/or credit by January 29, please email us at the address shown on the slide. And that email address is cl.sl.web.conference.team@irs.gov. And if you’re interested in finding out who your local stakeholder liaison is, visit IRS.gov. Or send an email to the address shown on this slide and we’ll send you that information.

We would appreciate it if you would take a few minutes to complete a short evaluation before you exit. We look forward to reading your information. It really helps us a lot. And if you’d like more sessions like this one, let us know. If you have thoughts on how we can make them better, please let us know that as well. If you have any requests for future webinar topics or pertinent information you’d like to see in an IRS Fact Sheet, Tax Tip, or Frequently Asked Questions on IRS.gov, then please include your suggestions in the comments section of the survey. Click on the survey button on the right side of your screen to begin. If it doesn’t come up, check to make sure you’ve disabled your pop-up blocker.

And finally, guys, it has been a pleasure to be here with you. And on behalf of the Internal Revenue Service and our presenters, we would like to thank you for attending today’s webinar. It’s important for the IRS to stay connected with the tax professional community, individual taxpayers, industry associations, along with federal, state, and local government organizations. You make our job a lot easier by sharing the information that allows for proper tax reporting.

So thanks again for your time and attendance. We hope you found the information helpful. And you got another one more minute back in your day as we leave today. So you may exit the webinar at this time.