Form 8862: Information To Claim Certain Credits After Disallowance (2014)
If the IRS has previously denied or reduced your Earned Income Credit (EIC), Child Tax Credit (CTC), Additional Child Tax Credit (ACTC), or American Opportunity Tax Credit (AOTC), Form 8862 is your gateway to claiming these valuable credits again. This form serves as your formal recertification, proving to the IRS that you now meet all the requirements and deserve another chance at these credits that can put hundreds or even thousands of dollars back in your pocket.
What Form 8862 Is For
Form 8862, titled ""Information To Claim Certain Credits After Disallowance,"" is a specialized IRS form that taxpayers must complete when they want to reclaim tax credits that were previously denied or reduced. Think of it as a ""second chance"" form that allows you to demonstrate you've corrected whatever issues caused the initial disallowance.
The form applies to four major tax credits: the Earned Income Credit (EIC), which helps low-to-moderate income workers; the Child Tax Credit (CTC) and Additional Child Tax Credit (ACTC), which provide benefits for families with qualifying children; and the American Opportunity Tax Credit (AOTC), which assists with education expenses. For the 2014 tax year, these credits could be worth substantial amounts—the EIC alone could provide up to $6,143 for families with three or more qualifying children.
However, Form 8862 is only required when your credit was denied for substantive reasons—not simple math errors. If the IRS reduced your credit because you miscalculated a number or made a clerical mistake, you don't need this form. But if your credit was disallowed because you claimed a child who didn't meet the qualifying tests, reported incorrect income, or violated other eligibility rules, Form 8862 becomes mandatory before you can claim that credit again. IRS.gov
When You’d Use Form 8862
Late or Amended Filings
You must attach Form 8862 to your tax return the next time you want to claim any of these credits after a disallowance. For example, if your 2013 tax return had a denied EIC and you want to claim it again on your 2014 return, you must include Form 8862 with that 2014 filing. This requirement applies whether you're filing on time, late, or submitting an amended return.
There are important exceptions where you don't need Form 8862, even after a previous disallowance. You're exempt from filing it if you already successfully filed Form 8862 once before and the IRS allowed your credit without any subsequent disallowances (other than math errors). Additionally, if you're claiming the EIC without a qualifying child and your previous denial was solely because of an issue with a qualifying child you claimed, you can skip Form 8862.
For late filers or those considering amended returns, the same rules apply. If you missed the filing deadline and your credit was previously denied, you must include Form 8862 when you eventually file. If you're amending a return to claim a credit that was previously disallowed, Form 8862 must accompany your Form 1040X (Amended U.S. Individual Income Tax Return). IRS.gov
Key Rules or Details for 2014
For the 2014 tax year, Form 8862 had specific requirements and limitations that taxpayers needed to understand. The form consisted of four parts: Part I applied to all filers and required basic information about which credit was denied and in what year; Part II was specific to those claiming the Earned Income Credit; Part III applied to Child Tax Credit and Additional Child Tax Credit claimants; and Part IV was reserved for American Opportunity Tax Credit filers.
A critical rule for 2014 involved ban periods. If the IRS determined your credit claim was due to ""reckless or intentional disregard"" of the rules, you would be banned from claiming that credit for two years. Even more seriously, if the IRS found fraud, the ban extended to ten years. During these ban periods, Form 8862 couldn't help you—you were categorically prohibited from claiming the credit, regardless of whether you otherwise qualified. IRS.gov
For the 2014 Earned Income Credit, income thresholds were specific: earned income and adjusted gross income (AGI) had to be below $46,997 for those with three or more qualifying children ($52,427 if married filing jointly), $43,756 for two children ($49,186 married filing jointly), $38,511 for one child ($43,941 married filing jointly), or $14,590 with no qualifying children ($20,020 married filing jointly). Investment income could not exceed $3,350 for any filer claiming the EIC.
Step-by-Step (High Level)
Completing Form 8862 begins with gathering documentation that proves you now meet all requirements for the credit you're claiming. This includes birth certificates for qualifying children, school records proving residency, Social Security cards showing valid SSNs, and income documentation like W-2s and 1099s.
Start by completing Part I of the form, which applies to everyone. You'll indicate which year your credit was denied, which specific credit was disallowed, and provide basic information about why you now believe you qualify. Be thorough and honest—the IRS will scrutinize this form carefully.
Next, complete the specific part that applies to your situation. If you're reclaiming the Earned Income Credit, fill out Part II, answering detailed questions about your qualifying children, their relationship to you, where they lived, and how long they resided with you in the United States during 2014. For Child Tax Credits, Part III asks similar but distinct questions about your children's citizenship and dependent status. The American Opportunity Tax Credit section (Part IV) focuses on the student's education status and expenses.
After completing the appropriate sections, attach Form 8862 to your Form 1040 or 1040A (you cannot use Form 1040EZ when claiming these credits with Form 8862). If you're claiming the EIC with a qualifying child, you must also attach Schedule EIC. Submit everything together—the form is useless if filed separately from your tax return.
Common Mistakes and How to Avoid Them
One of the most frequent errors taxpayers make is failing to file Form 8862 at all when it's required. Many people don't realize that after a disallowance, they can't simply claim the credit again on their next return without this form. The IRS will automatically deny the credit if Form 8862 is missing, even if you otherwise qualify. Always check your previous year's correspondence from the IRS to determine if you received a disallowance notice.
Another common mistake involves qualifying child requirements. For 2014, a qualifying child had to meet four tests: relationship (your son, daughter, stepchild, foster child, sibling, or descendant of any of these), age (under 19, or under 24 if a full-time student, or any age if permanently disabled), residency (lived with you in the U.S. for more than half of 2014), and joint return (the child didn't file a joint return unless only to claim a refund). Many taxpayers claim children who fail one of these tests, particularly the residency test. Gather strong documentation like school records, medical records, or official correspondence addressed to the child at your address.
Income misreporting causes frequent Form 8862 denials. Be scrupulously accurate about both your earned income and your investment income. For 2014, investment income over $3,350 disqualified you from the EIC entirely. Many taxpayers forget to include tax-exempt interest, capital gains distributions, or rental income when calculating this threshold. Use Worksheet 1 from Publication 596 if you're filing Form 1040 to ensure accurate calculation.
Filing status errors also trigger problems. You cannot claim these credits with ""Married Filing Separately"" status (with rare exceptions for separated spouses qualifying as Head of Household). Additionally, all filers and qualifying children must have valid Social Security Numbers issued before the return's due date—Individual Taxpayer Identification Numbers (ITINs) don't qualify. IRS.gov
What Happens After You File
Once you submit your return with Form 8862 attached, the IRS will review it more carefully than a typical return. Your return will likely be flagged for additional scrutiny, and processing may take significantly longer than the standard refund timeline—potentially several months instead of the usual 21 days for e-filed returns.
The IRS may send you a letter requesting additional documentation to verify the information you provided on Form 8862. This is routine and expected. Common documentation requests include birth certificates, school records, medical records, landlord statements, or other proof that qualifying children lived with you for the required period. Respond promptly and completely to these requests—failure to provide requested documentation within the specified timeframe (usually 30 days) will result in automatic credit denial.
If the IRS approves your Form 8862 and allows your credit, you'll receive your refund with the credit amount included. More importantly, you've now been ""recertified"" for that credit. This means you won't need to file Form 8862 again in future years, as long as the credit isn't denied again for substantive reasons. You'll receive Notice CP74 if the IRS formally recertifies you.
However, if the IRS denies your credit again, you'll face the same process next year—and potentially more serious consequences. A second denial could trigger a ban period if the IRS determines you were reckless or fraudulent. You also may be subject to the Erroneous Claim for Refund or Credit penalty, which is 20% of the excessive amount claimed. If you disagree with the IRS's decision, you have appeal rights, which will be explained in the denial notice you receive. IRS.gov
FAQs
Do I need Form 8862 if my credit was denied due to a math error?
No. Form 8862 is only required when your credit was reduced or disallowed for substantive reasons other than mathematical or clerical errors.
Can I claim different credits on the same Form 8862?
Yes. If multiple credits were previously disallowed, you can use one Form 8862 to recertify for all applicable credits by completing the relevant sections.
What if I can't find my disallowance notice from the IRS?
Contact the IRS at 1-800-829-1040 to request information about prior year credit disallowances. Keep records of all IRS correspondence to avoid this situation.
How long does the IRS take to process returns with Form 8862?
Significantly longer than typical returns—often 2-4 months or more, as these returns undergo enhanced review and may require additional documentation.
If I'm banned from claiming a credit for 2 or 10 years, can Form 8862 override that?
No. During a ban period imposed for reckless disregard (2 years) or fraud (10 years), you absolutely cannot claim the credit, and Form 8862 cannot change that.
What happens if I forget to attach Form 8862 when it's required?
The IRS will automatically disallow your credit claim. You may receive a notice explaining the issue, and you'll need to file an amended return with Form 8862 properly attached.
Does filing Form 8862 guarantee I'll get the credit?
No. Form 8862 is just the recertification mechanism—you still must meet all regular eligibility requirements for the credit you're claiming, and the IRS will verify your documentation before approving it.
This summary is based on official IRS guidance for tax year 2014. For complete instructions and the most current information, visit IRS.gov or consult a qualified tax professional.
