Tax Amendments

When filing taxes, errors or omissions can happen, whether by mistake or due to changing circumstances. Tax amendments are the process of making corrections to your tax return after it has been submitted to the IRS. Amendments are necessary when you realize that you made a mistake, missed a deduction or credit, or need to report additional income.

In this guide, we’ll explore what tax amendments are, why they’re important, when to file them, and how to avoid common mistakes. We’ll also walk you through the process of amending your tax return and explain the steps for filing an amended return.

What Are Tax Amendments?

A tax amendment is a change made to your previously filed tax return. This change could be related to income, deductions, credits, or any other information reported on the return. When you realize that your tax return contains errors or that you missed something important, filing an amendment allows you to correct the mistakes.

If you’ve already received your tax refund or paid your taxes, filing an amended return may result in receiving a larger refund or owing less money. However, if the correction increases the amount of taxes you owe, you may need to pay additional taxes.

The IRS allows taxpayers to correct their returns using Form 1040-X, Amended U.S. Individual Income Tax Return. This form is specifically designed to correct errors or omissions on a previously filed return.

When Should You File a Tax Amendment?

You should file a tax amendment if:

1. You Made an Error on Your Original Return
   This could include mistakes such as incorrect income reporting, missing deductions, or wrong filing status. If you notice such errors after filing your original tax return, it’s a good idea to amend your return to ensure accuracy.

2. You Need to Claim Additional Deductions or Credits
   If you forgot to claim a tax deduction or credit that you’re entitled to, filing an amended return allows you to correct the oversight. For example, if you missed a charitable donation deduction or forgot to claim child tax credits, you can amend your return to include these.

3. You Received Additional Forms After Filing
   Sometimes, taxpayers receive additional tax documents after they’ve filed their original returns. If you received a W-2, 1099, or other tax forms after filing, and these documents affect your tax liability, you need to amend your return to reflect this new information.

4. Your Tax Professional Identifies an Error
   If you worked with a tax preparer and they later find mistakes on your original return, they will typically recommend filing an amended return to correct those errors and avoid any penalties.

5. You Discover Fraud or Tax Identity Theft
   If you believe someone has filed a fraudulent return using your information or that your tax data has been compromised, you may need to amend your return to address the issue.

How to File a Tax Amendment

To amend your tax return, you need to use Form 1040-X, Amended U.S. Individual Income Tax Return. Here’s how the process works:

1. Obtain the Correct Form
   Form 1040-X is available on the IRS website or through tax preparation software. You’ll need to reference the original tax return you filed and make the necessary corrections.

2. Fill Out the Amended Return
   On Form 1040-X, you’ll need to provide information about your original return and indicate the changes being made. The form has three columns:

   • Column A: The figures from your original tax return.
   • Column B: The changes you are making to the original return.
   • Column C: The corrected figures after making those changes.

3. Explain the Changes
   On the form, you’ll need to provide an explanation for why you are amending your return. This explanation should clearly outline the errors that were made and how they have been corrected.

4. Submit the Amended Return
   After completing Form 1040-X, you can file the form with the IRS. Be aware that Form 1040-X can only be filed by paper for most taxpayers (some taxpayers may be able to file electronically, depending on the tax year). If you owe additional taxes, you can pay them along with your amended return.

5. Wait for the IRS to Process the Amendment
   After submitting your amended return, the IRS will review the changes. It can take the IRS up to 16 weeks or longer to process an amended return. During this time, they may contact you for additional information or clarification.

6. Track Your Amendment
   The IRS provides an online tool called “Where’s My Amended Return?” where you can track the status of your amended return. This tool is available about 3 weeks after filing the amendment.

Common Mistakes to Avoid When Filing an Amendment

When filing a tax amendment, it’s important to avoid these common mistakes:

1. Amending for Small Errors
   If you made a minor mistake, like a simple math error, and it does not change your refund or tax liability, you may not need to amend your return. In many cases, the IRS will correct minor errors automatically.

2. Missing Deadlines
   There is a statute of limitations for filing tax amendments. Generally, you must file an amended return within three years from the original filing deadline or two years from the date you paid your taxes (whichever is later). Missing this deadline may mean you lose the opportunity to receive a refund or make changes.

3. Not Including Supporting Documentation
   Be sure to attach any necessary supporting documents when filing your amended return. This may include forms like a corrected W-2 or 1099, new deduction receipts, or other relevant documents.

4. Not Checking for Other Issues
   When you file an amendment, double-check your entire return to ensure you don’t overlook other potential errors. The amendment process is an opportunity to fix multiple issues on your return at once, not just one mistake.