Taxpayers, including companies, have a limited timeframe in which to file an amended tax return. The 1040X must be filed within three years of the date that you originally filed or within two years of when you paid your taxes, whichever is later. There are a number of circumstances under which you should file an amended return and some under which you should not.  If you are a taxpayer in the Willow Grove area, we can help you sort out the details of what course of action is best for you.  

When you should file an amended tax return

File an amended return if you realize you did not include all sources of income (i.e., from a side job or from a W-2, 1099, or payment that you received, found, or remembered after filing) or if you missed a credit or deduction for which you were eligible. These are common mistakes if you are not working with a competent tax accountant or if you did not provide your accountant with complete information. A good tax accountant will know what questions to ask you to avoid most of these mistakes.

Other reasons for filing an amended return might include receipt an adjusted W-2 or 1099, miscalculation of the cost of investments, use of the wrong filing status, or a dependency discrepancy. Such a discrepancy can occur when two people filing separately both claim a child as a dependent or if a young adult is claimed both on the parents’ taxes and his or her own.

Occasionally, changes in IRS rules can be applied retroactively to your benefit. A good tax accountant should be able to notify you of this and help you take advantage of this opportunity.

When you should not file an amended tax return

If you’ve received a notice from the IRS, do not file an amended return. This could confuse the IRS’s system and cause a delay in the resolution of the situation.

If the IRS sends you a CP2000 notice, respond directly to the inquiry, do not send an amended return. If you receive an audit notice, do not refile. In both of these situations, talk to a tax accountant to help you prepare and respond accurately.

If your e-file was rejected, check that all your critical information was filled in correctly and resubmit. If you notice you made a calculation error on your return, do not refile – the IRS will probably catch it and send you a correction. But be sure to check their numbers, as well.

Contact us here at Koelle to help you with your amended return, so you can receive the maximum tax benefit allowable. We have been serving businesses and individuals for over 30 years in Willow Grove, Abington, Ft. Washington, Huntingdon Valley, Hatboro, Warminster, and surrounding areas.