Realizing you made a mistake on your tax return? Don’t panic.
If you overlooked a valuable deduction, say, or forgot to report some of your income, you can simply file an amended return. Amending your return to correct a mistake may help you get your rightful refund or avoid trouble with the Internal Revenue Service.
Is it possible to make corrections on your tax return?
It’s entirely possible and sometimes even necessary. The IRS knows you may need to make corrections to a previously filed federal tax return, so it provides a structured process and a dedicated form for doing so.
To file an amended individual tax return, you would use Form 1040-X, ‘Amended U.S. Individual Income Tax Return.’ With this form you can correct errors, include previously omitted information or adjust a return based on changes in income, deductions or credits.
When to file an amended tax return
Here are some situations in which amending a federal tax return is worthwhile.
- Incorrect income. If the income you reported on your original tax return was overestimated or underestimated, you can file an amended return to correct the discrepancy. This might happen if you overlooked an income source or subsequently received a corrected 1099 or W-2 form.
- Change in filing status. Life events such as marriage, divorce or the death of a spouse can alter your filing status. If you used the wrong tax filing status on your return, you can correct it on an amended return.
- Errors in dependents claimed. If you incorrectly claimed someone as a dependent or failed to claim a qualifying dependent, amending your return can fix these errors, potentially affecting your tax liability or refund.
- Overlooked tax deduction or credit. You might discover you missed some tax breaks for which you were eligible. An amended return allows you to claim them after the fact, possibly resulting in a refund.
When not to file an amended tax return
While amending your return is essential for correcting significant errors or omissions, there are times when it’s unnecessary. Sometimes the IRS may even advise against it. Understanding when not to file an amended return can save you time and prevent unnecessary processing delays.
Here are some scenarios where an amended tax return might not be warranted.
- Math errors. The IRS automatically corrects mathematical errors found on tax returns during processing. So if your original return contains a simple math mistake, there’s no need to file an amended return.
- Missing forms. If you forgot to attach certain forms or schedules to your tax return, the IRS will typically request the missing information without requiring an amended return. That information might include documents showing withheld tax or appraisals to support high-dollar charitable donations.
- Minor mistakes. Small errors, such as misspellings, don’t alter your tax liability and do not necessitate an amended return. The IRS will usually overlook these minor missteps without your intervention.
- Recently filed returns. If you discover an error on your return shortly after filing it, you should wait until the IRS processes your return before taking action. Filing an amended return too quickly can lead to confusion and delayed refunds if the IRS processes the amended return before it gets to your original return.
- Adjustments prior to the tax filing deadline. If you discover an error before the filing deadline, you can simply fix the error on your return and refile it before the deadline. When e-filing, you’ll need to check a box to indicate that you’re filing what is called a superseding return.
- Very small refunds. Say you realized that you made an error on your return, and correcting it would result in a very small tax refund. The time or fees involved in amending your return might far outweigh the value of that refund. In that case, taking action isn’t worth it.
If you need help deciding whether to file an amended return, consult with a tax professional.
Contact the Pinnacle CPA Advisory Group
Need help with your taxes? Contact the experts at Pinnacle CPA Advisory Group. Call our Columbus offices at (614) 942-1990, send email to us at info@cpaagi.com, or just fill out the Contact form on this website, at cpaagi.com/contact.