Considerations for Taxpayers Who Need to Amend a Return

Taxpayers who discover they made a mistake on their tax returns after filing can file an amended tax return to correct it. This includes changing the filing status and dependents, or correcting income, credits or deductions. What you may not know is that every amended return gets a set of eyes – this is different from filing your initial return, in which the computer scans the informational entries. By filing an amended return, you subject your return to a higher scrutiny, and therefore a greater likelihood that the return may be picked up for other items. So be aware of this process and potential for greater scrutiny, and be wise in your decision to amend. Here are some considerations:

• Taxpayers should not file an amended return to fix math errors, because the IRS computers will correct those and send out a notice to the taxpayer.
• Aside from math errors, taxpayers also do not need to amend their return if they forgot to include a required form or schedule. The IRS will mail a request to the taxpayer, if needed.
• Taxpayers filing an amended return because they owe more tax should file Form 1040X and pay the tax as soon as possible. This will limit interest and penalty charges.
• Wait to file an amended return until your initial return is processed. You have a three-year time limit to file for a refund. Generally, to claim a refund, taxpayers must file a Form 1040X within three years from the date they timely filed their original tax return or within two years from the date the person pays the tax – usually April 15 – whichever is later.

If you want or need to amend a return, it is best to discuss the matter with your tax professional.

Contact Tax Attorney Stephen McFarlane at McFARLANE LAW – A Tax Law Firm
T. 480.991.0032 or [email protected]