What do you do if you discover a mistake on your tax return?
First…don’t panic! You can file an amendment. But before you do, there are a few things to know.

1 – The IRS (Internal Revenue Service) may fix the mistake for you.

Most of the time, you’ll want to fix your own mistakes. But sometimes, it might make sense to let the IRS do it. They will correct math errors and may even take it a step farther and make sure it’s reflected everywhere. In some cases, the agency may apply that estimated payment you forgot you made. These are the sorts of relatively harmless errors that you can happily let the IRS correct for you. If the IRS does correct a mistake, you’ll receive a letter explaining the adjustment and advising what steps, if any, you need to take.

2 – You can fix most mistakes by filing an amended return.

If the IRS doesn’t correct your mistake—or if it’s a huge mistake or you forgot to report something major and important (like being married)—you need to fix the mistakes. You do this by amending your previously filed tax return with a federal form 1040X, Amended U.S. Individual Income Tax Return. You can use IRS Form 1040X to correct a previously filed form 1040, form 1040A, form 1040EZ, form 1040NR, form 1040NR-EZ, or to change amounts previously adjusted by the IRS.

3 – Carefully follow the instructions.

Form 1040X is short (just two pages long), but it can be confusing if the instructions are not followed correctly. Form 1040X is the only tax form you need to use to correct your mistakes. You don’t need to file another form 1040, or other 1040 series form, because the front page of the amended return is an abbreviated version of form 1040.

4 – You’ll need a copy of your previously filed return.

To file an amended tax return, column A on Form 1040X will ask you to briefly summarize the items on your tax return as they were originally reported. 

Column B is where you will indicate any adjustments for income, deductions, liabilities, and payments. 

In Column C, list the correct amounts as they should have appeared on the original tax return.

Note: Column A + Column B = Column C. (A + B = C)

5 – Keep in mind that changes to one item may change more than just that item. 

For example, if your adjusted gross income (AGI) changes, items that use your AGI may also change (such items include certain itemized deductions, tax credits, and a taxable amount of Social Security benefits). This is also true for changing your filing status.

6 – Even if a tax break has disappeared, it doesn’t mean that you can’t claim it on an amended return. 

A lot of tax items were changed with The Tax Cuts and Jobs Acts (TCJA), however, as long as those tax breaks were available for the tax year you are amending, you can still claim the item. For example, at Part I, at the top of the second page, you could still make adjustments to personal exemptions and dependents for prior years (such as 2017) even though personal exemptions didn’t apply for the 2018 tax year.

7 – Let the IRS know your story. 

Use the space at Part III on the second page to explain why you are filing the amended return. It’s not meant to be a confession or an appeal, so keep it clear, concise and brief. Examples might include “I missed reporting this income because I received my 1099 late” or “I forgot to claim the child tax credit.” That’s all you need to say.

8 – Is there an online option for amended returns?

Unfortunately, you will need to go old school and print Form 1040X, complete all the information, then mail it. 

9 – Attach the right documents—but don’t include papers that aren’t needed. 

You must attach copies of any forms or schedules affected by the change, including any W-2 or 1099 forms (the normal rules apply here), or specific schedules that you didn’t attach previously. Don’t confuse the IRS by adding other forms or papers that don’t apply. In the instructions, they specifically request that you “not attach items unless required to do so.”

10 – Include payment if you owe money due to the amended form. 

If your amended return reflects a balance due, include payment with your return. If you can’t pay the full balance, make payment arrangements with the IRS, but remember that there may be penalties and interest due. 

11 – You may be owed a refund. 

If you are owed a refund, you can choose to apply it to the next year’s return or have a refund check mailed to you. To claim a refund, you typically must file your Form 1040X within three years after the date you filed your original return or within two years after the date you paid the tax, whichever is later. The normal statute of limitations still apply, so filing an amended return does not extend the statute of limitations or give you extra time to pay. If you file after the statute of limitations has run, you may be out of luck. 

The Bottom Line

Taxes are confusing enough. Understanding the process for amending a tax return can be even more puzzling for most people. If you’re a working family or individual in Southeastern Pennsylvania or Southern New Jersey, let our professional experts walk you through the process for free.