There’s a reason that many people hire accountants or tax preparers to do their taxes for them. Well, there are actually several reasons, but one big one is that it’s very easy to make mistakes in a tax return. If you don’t think like an accountant, don’t have time to focus on the task, are in a rush, don’t understand all the little variations that may or may not apply to you, or just don’t want to deal with tax preparation in the first place, it can be surprisingly easy to make a mistake without realizing it. And while some tax form mistakes aren’t that big a deal, some can cause issues. If a mistake causes you to owe extra money, for instance, you’ll be hit with an unexpected bill—or, in the long term and worst case, a tax levy. The good news is that not only are most mistakes nowhere near that serious, they can usually be corrected pretty easily. Here’s what you need to know.
First, for most minor mistakes you won’t have to take any corrective action. If you made an arithmetic error, for instance, the IRS will typically correct it for you and let you know if that changed anything. If you forgot to file a particular form, or filed the wrong form, the IRS will send you a letter requesting the correct or missing form. Incidentally, it will always be a letter. If you get a phone call from the IRS, it’s a con artist pretending to be the IRS. Don’t listen to them, and especially don’t give them any money. And if you owe more money (or are entitled to a larger refund) than you originally thought, the IRS will let you know about it. So with the majority of mistakes, correction on your part won’t be necessary.
There are other cases, however, where you may need to amend or correct a tax return. In particular, these include situations where your personal circumstances have changed, especially including your filing status, your income or the tax deductions or credits you claimed when you filed. If you mistakenly listed any of these incorrectly, you would need to correct the return as well. Or if you thought a certain item was taxable, but it wasn’t (or vice versa), an amendment to the return would be appropriate as well.
You can amend or correct a tax return by filing Form 1040X, the amended return form, after you file your original return. When you do, make sure that you include the following:
– The tax year for which you’re filing the amended return
– A copy of the original return
– Copies of any forms or schedules that the amendment changes or alters
– Any new information or documentation that supports or is required by the amendment
You don’t have to be in a huge hurry to file the amended return. There’s no emergency-like sense of urgency to it—as long as it happens, it doesn’t need to happen yesterday. If you are expecting a refund (or filing the amendment to obtain one), though, make sure you file the amendment within three years of the original return. And if you’re unsure of how to handle a tax return mistake situation, feel free to reach out to your accountant or tax preparer for help.