What You Should Know About Amending Your Tax Return

Posted by: Brookside Admin

Have you ever considered what to do if you suddenly realized after submitting your tax return that you'd made a mistake? IRS Form 1040X, Amended U.S. Individual Income Tax Return, is available for just this reason. But, it's not always required that you amend your tax return, and doing so can cause you to pay more in taxes in certain circumstances. So, it's important that you understand when you should, and should not, amend your individual tax return. 

Accurate to your best knowledge

This is an important bit of language included on each individual tax return. When you submitted your tax return, did you think it was accurate to the best of your knowledge? If so, amending it likely isn't required, even if you find out later that there was definitely a mistake made. If it turns out you owe additional money, well, you'll still probably get a bill from the IRS. But, no further action is needed from you until the IRS notifies you. If, however, you submitted a return you knew included a mistake, it's best to amend it immediately rather than wait to see if you're caught. Doing so could save you from a civil audit or criminal prosecution. 

Correct it all

In some cases, you may discover that you were owed a bigger refund than you originally thought. Amending your return can get you the additional money back that the IRS owes you. But, you can't simply go back and fix the errors or omissions that work in your favor. If you're going to amend your return, you need to make sure you fix everything that's wrong with it, including the mistakes that result in you paying more taxes. 

Fixes by the IRS

For some specific and common mistakes, an amended return isn't necessary because the IRS will fix them. Bad math is the most popular example. Math errors on your return are expected and will typically be adjusted by the IRS after you file. This again could result in you getting a bill for additional taxes owed, but it doesn't require you to amend your return. Surprisingly, you also won't need to amend if you forgot to include your W-2, or left off certain other paperwork in most cases. The IRS may be able to process your return without these documents, and, if they can't, they'll notify you and request what's needed. 

Filing status

Changing your filing status could make a significant difference in your tax liability, but depending on your circumstances, you may not be able to make this change even through amending your return. If you originally filed as married filing separate, amending your return will allow you to change to married filing jointly. Likewise, you can change from qualifying widow(er) status to head of household status by amending your return. However, if you originally file as married filing jointly, you won't be able to change that status to filing separately after the due date for your tax return has passed. 

You're able to amend tax returns for three years after your due date, so you can even go back to older returns and see if any mistakes could allow you to get more money back. But, you'll have to file Form 1040X the old fashioned way. The IRS only accepts amended returns on paper, even if the original return was filed electronically. 

For help with any type of tax questions or issues for your individual returns or your business returns, call the CPAs at Brown Kinion and Company.