Reply #4: I wouldn't recommend it.

[racaulk]

I'm a tax accountant, but individual income taxes are not my strength. But in general, net operating losses can be carried forward to offset income in future years. If you claim no loss in the current year, you could be screwing yourself out of a tax benefit in the future...and would a few extra dollars with the EIC in the current year be worth that?

Also, the IRS carefully scrutinizes any EIC claimed. This is one area where they do not screw around. The instructions for the 1040 clearly state penalties for knowingly making false statements in order to claim an EIC, including not being able to claim the EIC for up to 10 years.

As the poster upthread stated, you should be making complete and accurate statements on tax returns filed, which is the statement you attest to when you sign the return. You should not arbitrarily pick and choose what will make your tax situation most advantageous. I think you're walking that thin line between tax avoidance and tax evasion with this, and when there is doubt in that regard, it's always best to make full disclosure and to be honest.

I hope this helps. Best of luck! :hi: