Because everyone makes mistakes, the IRS has devised a way for you to fix mistakes made on your federal income tax return. The method is to use the 1040x form for filing an amended return. The IRS advises you not to file an amended return to correct math errors unless the wrong amount was posted, and it is significant. You are also allowed to file an amended federal return for up to the last three years.
You must have filed a federal tax return to amend it.
While this seems rather obvious, making sure that your taxes are filed is important. If you know ahead of time that you may have to amend your return, you might be better off to file a form 4868 for an filing extension. This will allow you to file up to six months later without penalty as long as your taxes were paid by April 15. If you are missing W-2 forms or other critical tax paperwork, the extension is the better way to go.
File an amended federal tax return as soon as you realize that a critical error exists.
If you notice that you have omitted a form from your return, sometimes it is best to wait for the IRS to contact you for the form. However, sometimes this leads to adjustments in your taxes due. If submitting the requested information does not resolve the issue, an amended return is the best solution.
People sometimes realize that income was overlooked when filing their taxes.
An amended return should be sent to the IRS with the adjusted taxes due as soon as possible. Interest and penalties start at the time the taxes were due but not paid. Paying them sooner rather than waiting for the IRS to contact you is the best route to go. This will reduce the amount of the penalties and interest that can sometimes more than double the tax bill.
More often, amended returns are filed to take advantages of additional deductions and tax breaks.
When items like the capital gains on a family’s principle residence are included in income, the amount of surplus taxes paid to the government can be substantial. The same is true for inheritances below the tax-free limit. Filing an amended return allows the taxpayer to recover taxes that were overpaid in error without having to go through a lot of hassle to do it.
After your taxes have been filed, it is never too early to send an amended return.
As long as the amended return is in a separate envelope from your 1040, it is alright to send it to the IRS. You are always better off sending it as soon as you can because of the three year limitation to amend tax returns. If you go a day past this limit, you will not be able to recover any tax over payments. However, the IRS will still accept any tax monies that you owe.
For additonal information, you can visit the IRS website at: http://www.irs.gov/taxtopics/tc308.html