Amended tax returns | Amended Refund | Income Tax Amendment

What is an Amended Return?

An amended return is essentially a corrected version of a previously filed federal income tax return. It allows taxpayers to make changes or corrections to their original return, such as reporting additional income, claiming a new tax credit, or fixing errors. The Internal Revenue Service (IRS) provides this option to ensure that your tax return is accurate and up-to-date. Whether you need to adjust your reported income, add a missed deduction, or correct a mistake, filing an amended return can help you set the record straight.

Should I file an Amended Tax Return?

Whether you already filed your yearly tax returns on time or perhaps after the tax deadline – there is still a chance that you might receive information that was not included, or you discover something that was missed such as a significant deduction. In this case, you should consider filing an amended tax return. It is crucial to use the correct documentation for each specific tax year when filing an amended return.

Should I file an amended tax return if I discover an error or receive new information?

There is no actual requirement to file an amended return and no penalty if the IRS owes you money. Filing is not required even if new information comes to light (such as receiving a revised 1099 or K-1) although in the latter case, the IRS recommends you do amend. Worthless securities and bad debts also may merit an amendment — and taxpayers have up to seven years to go back and claim those losses.

However, if you do need to amend your federal tax return, it is necessary to file both a federal amended return and a corresponding state tax return. Each state has specific forms for amending tax returns, and Torchlight Tax can handle the whole process for you.

Is it worth the time and costs to use an amended tax return service?

Determining if amending your return(s) is worth your time and money vs the reward it can potentially return is something a tax professional such as Torchlight Tax & Accounting in Las Vegas can help you best understand. Our amended tax return specialists in Las Vegas can investigate returns as far back as 3 years to find any errors or missed deductions. We can then calculate if you can expect just a meager increase in your refund or if the increase in your refund is potentially larger. By estimating how much your increase will be ahead of filing the amended return, you can decide if the investment in time and money is worth the increase!

Filing an Amended Federal Income Tax Return

To file an amended federal income tax return, you’ll need to complete Form 1040-X, Amended U.S. Individual Income Tax Return. This form is specifically designed to report changes to your original return, including additional income, deductions, and credits. You have the option to file an amended return electronically or by mail, depending on your preference and the specifics of your situation. Be sure to attach any supporting documentation, such as a new W-2 or 1099 form, to substantiate the changes you’re making. This ensures that the IRS has all the information needed to process your amended return accurately.

What to consider if you amend your return(s) and check your amended return status

Amending Tax returns generally requires more expertise than doing it right the first time. This may seem counter-intuitive, but as a practical rule in doing thousands of tax returns, we have found this to be the case.

To correctly submit amended forms, ensure you use the appropriate forms to reflect changes in income or tax credits. Include all necessary documentation and be aware of the potential interest charges for late payments. Failure to file properly can result in additional scrutiny from the IRS.

We are not, however, legally required to do a full audit of your accounting and tax returns to do an amendment. If something on your tax return was missed, like a large expense for your business, a donation to your church, or a 1099 showing a chunk of un-reported income, we can correct that point without assuming everything else was wrong.

An amended return is more likely to be audited then an original return, and if your amended return results is asking for considerable money back, the IRS may review it even more carefully.

It’s worth noting that amended returns are now eligible for e-file in many cases. This is a recent change. You still may need to paper file an amended return. If paper-filing more than one year, be sure to send each year in a separate envelope.

Also, amended returns should be sent certified. You do not want your amended return sitting in some IRS backlog with no proof that you sent it in. The IRS will generally not believe you if you say you filed a tax return and they do not show it in their system. They do, however, believe you when you send a copy of the return and a certified mail receipt that shows when it was accepted. It is worth four bucks or whatever to send it certified. Be sure to keep the receipt!

Timing an Amended Tax Return

Timing counts when it comes to receiving a refund from amending a tax return and there is a select timeframe available. It’s commonly stated that you must amend within three years of your original return filing. However, the cutoff is three years from the date you filed your original return or two years from the date you paid the tax for the return you wish to amend, whichever is later.

The IRS typically has three years to audit a tax return. Even if you file an amended return, the three-year statute of limitations does not get extended. The amount of time left on the three-year window when you amend can be used to your advantage to assuage the worry of an audit. However, if it shows that you owe more, you will owe additional interest calculated from the due date of the original return (without regard to extensions) and probably penalties as well. If the amended return shows that you owe more, you will owe interest on the unpaid amount from the original due date until the date it is paid.

Amended Return Refund or Balance Due

If your amended return results in a refund, the IRS will issue a new refund check or direct deposit the amount into your bank account. On the other hand, if you owe additional tax, you’ll need to make a payment when you file the amended return to avoid penalties and interest. Payments can be made online, by phone, or by mail, and if you’re unable to pay the full amount at once, you may be able to set up a payment plan. It’s important to address any additional tax promptly to minimize any potential financial impact.

Tracking and Processing an Amended Return

Once you’ve filed an amended return, you can track its status using the IRS’ online tool, “Where’s My Amended Return?” This tool requires you to provide your Social Security number or Individual Taxpayer Identification Number (ITIN), date of birth, and ZIP code. Processing times for amended returns can vary, but it typically takes 8-12 weeks for the IRS to process an amended return. Keeping an eye on the status can help you stay informed and ensure that any issues are addressed promptly.

Common Amended Return Scenarios

There are several common scenarios where you might need to file an amended return. These include:

• Reporting additional income, such as earnings from a new job or freelance work.
• Claiming a new tax credit, like the Earned Income Tax Credit (EITC).
• Correcting errors on your original return, such as a math mistake or an incorrect Social Security number.
• Reporting a change in filing status, such as after a divorce or marriage.
• Claiming a new deduction, such as for charitable donations or mortgage interest.

It’s essential to file an amended return as soon as possible if you discover an error or need to make changes to your original return. Doing so can help you avoid penalties and interest, and ensure that you receive any refund you are due.

Possible Reasons NOT to Amend

• It’s important to first ask yourself whether the tax return you filed was accurate to the best of your knowledge when you filed it. If so, it’s an okay bet to decide not to file an amended return.
• If you simply discover a math error in your calculations, the IRS says there is no need to file an amended return. Their computers or paper-file reviewers will catch the error and correct any amount owed or due to you.
• If you forgot to attach certain paperwork to your return, such as a W-2, 1099, or schedules to show your work for different areas of the return, the IRS will likely be able to process your return without it or will send you a letter requesting the missing information.

Contact one of the offices of Torchlight Tax and Accounting for a free consultation on amending a tax return. We will give you the straight scoop. We will only amend a tax return if it makes sense and benefits you either financially or is legally required to protect you.

Contact Torchlight Tax for a free consultation. This can be done in-person, on-line, or over the phone. Or you can fill in the free consultation form on this website.

Call us at 1-877-758-7797 or 702-463-1818 or email us at info@TorchlightTax.com. We can transfer your call to a branch office near you or help you directly from our central office.