IRS CP79
We're Auditing Your Tax Return — Earned Income Credit Disallowed
Your Earned Income Credit has been denied. You have the right to appeal this decision.
Deadline
30 days to appeal the disallowance
If you do not appeal within 30 days, the EITC disallowance becomes final. You will owe the disallowed credit back plus interest, and may face a 2-year EITC ban.
Respond promptly to protect your options and avoid escalation.
What IRS CP79 Means
CP79 means the IRS has completed an examination of your Earned Income Credit (EITC) claim and has decided to disallow it — either fully or partially. Unlike CP75 (which opens the audit), CP79 delivers the conclusion: the credit has been denied.
EITC disallowance means you owe back the refund attributable to the credit, plus interest from the original due date. If the IRS determines your claim was made recklessly or with intentional disregard of the rules, you may also face a 2-year ban on claiming EITC (or 10 years for fraud).
However, you have the right to appeal. If you have documentation that was not submitted during the examination or if you believe the examiner made an error, an appeal is the appropriate next step.
What the IRS Can Do If You Don't Respond
- Finalize the EITC disallowance and issue a balance due for the refunded credit
- Impose a 2-year ban on claiming EITC for reckless disregard of the rules
- Impose a 10-year ban for fraudulent EITC claims
- Begin collection of the disallowed credit amount
What You Should Do Right Now
- 1
Gather all documentation you could not or did not submit during the examination
- 2
File an appeal within 30 days if you believe the disallowance was incorrect
- 3
School records, medical records, and residency documentation for qualifying children are critical
- 4
Contact a tax professional — EITC appeals have specific procedural requirements
Resolution Options Available to You
Frequently Asked Questions About IRS CP79
Can I appeal a CP79 disallowance?
Yes. You have 30 days from CP79 to file an appeal with the IRS Office of Appeals. The appeal must include the specific reasons you disagree and the documentation supporting your EITC eligibility.
What documentation is most important for an EITC appeal?
Evidence that the qualifying child lived with you for more than half the year: school records showing your address, medical records, lease agreements, utility bills, and daycare records are the most powerful forms of evidence.
What is the 2-year EITC ban and how do I avoid it?
If the IRS determines your claim was reckless (meaning you did not take reasonable steps to confirm eligibility), they can bar you from claiming EITC for two years. Cooperating fully with the examination and providing good-faith documentation is the best defense against the ban.
Professional References
IRC: IRC §32 — Earned Income Credit; IRC §32(k)(1) — 2-Year Disallowance Rule
IRM: IRM 4.19.14 — Earned Income Tax Credit Examination — Disallowance
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