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Posted by Tiffany Gaskin

When Do You Need to Amend Your Tax Return?

When Do You Need to Amend Your Tax Return?

If you want to make corrections to your tax return from previous years, you will need the amended tax return form. The amended return is to resolve the errors and place you on a tax advantage that may result in a refund. 

For example, the process helps correct misreported earnings or tax credits. However, you cannot resolve mathematical errors since it is the duty of the IRS when reviewing the tax return.

Who Qualifies to File an Amended Return?

The IRS requires all taxpayers to file the previous tax year's returns annually. In addition, those that realize their errors on the tax forms or face some changes after submitting or mailing their returns can submit an amended return.

To do this, the IRS will issue you an amended return form called Form 1040-X, or you can get it on the website. The upside is that you can file this correction even after the tax year ends.

When reviewing your tax form, Uncle Sam will likely fix all mathematical errors for you. In this case, the IRS will adjust the errors and increase the taxpayer's tax liability. However, you can't correct all errors using an amended return form. Another issue is omitting the required form or schedule. In this situation, the IRS will contact you and mail the missing information to their office.  

When to File an Amended Return

Here are instances where you'll need to file an amended tax return.

  • If your tax filing status needs to be corrected or you want to change it, you'll need an amended tax return form. For example, suppose you want a change from individual filing single to married status. In that case, you'll need an amended tax form to file the appropriate status, like married filing jointly (MFJ) or married filing separately (MFS).

  • If you enter the wrong number of dependents, you'll need an amended tax return to either claim or remove the additional dependents. For example, you cannot include a child born in a tax year before April. If so, you'll need an amended form to correct the error.

  • You'll need an amended tax return if you claim tax credits, did not claim a tax credit, or made incorrect deductions. 

  • If you report an income in the wrong tax year, the IRS needs you to file an amended tax return. If the IRS issues you additional tax documents like Form 1099 or K-1 after the deadline, you may need an amended tax return form to report the issue.

  • If you had some deductions later changed by legislation, you should resolve them through an amended form. For instance, the legislation changed the tax-deductible of private mortgage insurance (PMI) in December 2019, which initially expired in December 2017 under the Tax Cuts and Jobs Act of 2017. The change allows taxpayers to make these deductions in their 2019 and 2020 tax years while inactive in the 2018 tax year.

  • You'll need the amended form if you are involved in a tax relief caused by a natural disaster that leads to a change in your tax liability. The issue is prevalent for some taxpayers and happens mostly later in the tax year. These taxpayers receive tax relief from the government to lessen the effect of natural disasters. Still, it may take longer for the offer to be finalized by the legislation for the tax season. In such a case, taxpayers are expected by the IRS to pay their taxes in full. And if the legislation changes, they can take the amended return form to report their claim. 

  • If you realize the taxes you owe are less than what you paid, you'll need an amended form. If you fail to file an amended tax return, the IRS will slap you with penalties and interest.



Tiffany Gaskin
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