IRS Will Start Processing 8863 Returns Tomorrow, 8:00AM Eastern

BREAKING NEWS: The IRS will start processing Tax Year 2012 returns that contain Form 8863 Education Credits at 8AM EST tomorrow.

We highly encourage transmitting these returns as soon as possible today in anticipation.

NEWS UPDATE: IRS Will Accept 8863, Education Credits, Starting Feb 14, 2013

NEWS UPDATE: The IRS just released the following information:

"On Thursday, Feb. 14, 2013, the IRS plans to start processing Tax Year 2012 returns that contain Form 8863, Education Credits."

They also stated:

"Effective Sunday, Feb. 10, 2013, the IRS will start processing Tax Year 2012 returns that contain Form 4562, Depreciation and Amortization. After completing the 9:00 am, Eastern maintenance build window, the various business rules used to reject returns with Form 4562 attached will be disabled. That includes the Form 1040-family tax returns, Form 1065/1065-B, Form 1120-family tax returns and Form 990-family tax returns."

IRS Update Regarding Form 8863 Delay

Filers who need to attach Form 8863 used to claim the American Opportunity Tax Credit and the Lifetime Learning Credit to their tax return can prepare their return now but must wait to submit it in mid-February.
This applies to paper and electronic Forms 8863.

What you need to know:

• If the IRS received an electronic or paper tax return with a Form 8863 attached prior to Jan. 27, the IRS will hold it and push it through as soon as they are able to process Form 8863 in mid-February. Taxpayers/tax professionals do not need to take any additional action at this time.
• If you submitted an electronic tax return with a Form 8863 attached on Jan. 27 or later and the transmitter/taxpayer received a reject notification from the IRS tell the taxpayer they don't need to take any additional action. Tell them you will hold their return and resubmit it to the IRS as soon IRS is able to process it.
• If the IRS received a paper or e-filed F1040/1040A return with F8863 attached before Jan. 27, Where's My Refund will show the taxpayer that their return has been received. However, progress to the next phase: Refund Approved, will not occur before mid-February when the IRS can begin processing these returns. So taxpayers will not be given a refund date during this waiting period. Reassure taxpayers that this is expected due to the delayed processing of Forms 8863 and they do not need to contact the IRS about their return or take any other action.
• If the IRS received a paper F1040/1040A return with Form 8863 attached on Jan. 27 or later, the return will be held and will not show up on “Where's My Refund” until the IRS can begin processing Forms 8863. The taxpayer does not need to contact the IRS about their return or take any other action.
• If the IRS received an e-filed F1040/1040A with Form 8863 attached will debit payments be processed as scheduled for the F1040/1040A returns in suspense? Yes, since payments are processed separately from the returns (in paper and electronic) suspending the return will not interrupt the payment transaction. Payments should be debited as scheduled or processed as received.
• The IRS successfully opened the tax season for most taxpayers. The Jan. 30 opening includes people claiming the student loan interest deduction on the Form 1040 series or the higher education tuition or fees on Form 8917, Tuition and Fees Deduction. Forms that will be able to be filed later are listed on IRS.gov.

Updated information will be as it becomes available.

IRS Announces Delay in Form 8863 (Education Credits - American Opportunity and Lifetime Learning Credits)

The IRS has announced that they will not be accepting Form 8863 until late Feburary to early March 2013. This hold is industry-wide and will impact all transmitters and all tax preparers.

What you need to know:

• The IRS announced they will NOT be accepting Form 8863
• The hold is industry-wide direction from the IRS
• Form 8863 will be accepted by the IRS in the approximate timeframe: late February to early March 2013

“Like” us on Facebook at www.facebook.com/CrossLinkTax to receive the latest industry updates on this and other relevant topics.

Next Steps:

1. We are working with the IRS to determine the status of returns that have already been submitted with From 8863 and received acknowledgements. CrossLink will continue to keep you updated.
2. CrossLink has “blocked” Form 8863 until such time that the IRS is accepting this form. You CAN STILL SUBMIT RETURNS!
3. You will need to file an amended return once the IRS begins accepting Form 8863.

IRS To Accept Returns Claiming Education Credits by Mid-February

IR-2013-10, Jan. 28, 2013

WASHINGTON - As preparations continue for the Jan. 30 opening of the 2013 filing season for most taxpayers, the Internal Revenue Service announced today that processing of tax returns claiming education credits will begin by the middle of February.

Taxpayers using Form 8863, Education Credits, can begin filing their tax returns after the IRS updates its processing systems. Form 8863 is used to claim two higher education credits -- the American Opportunity Tax Credit and the Lifetime Learning Credit.

The IRS emphasized that the delayed start will have no impact on taxpayers claiming other education-related tax benefits, such as the tuition and fees deduction and the student loan interest deduction. People otherwise able to file and claiming these benefits can start filing Jan. 30.

As it does every year, the IRS reviews and tests its systems in advance of the opening of the tax season to protect taxpayers from processing errors and refund delays. The IRS discovered during testing that programming modifications are needed to accurately process Forms 8863. Filers who are otherwise able to file but use the Form 8863 will be able to file by mid-February. No action needs to be taken by the taxpayer or their tax professional. Typically through the mid-February period, about 3 million tax returns include Form 8863, less than a quarter of those filed during the year.

The IRS remains on track to open the tax season on Jan. 30 for most taxpayers. The Jan. 30 opening includes people claiming the student loan interest deduction on the Form 1040 series or the higher education tuition or fees on Form 8917, Tuition and Fees Deduction. Forms that will be able to be filed later are listed on IRS.gov.

Updated information will be posted on IRS.gov.

As written in IRS Press Release IR-2013-10 on 1/23/2013.