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Tax Return Corrections and Tips for next Tax Year

by | 52 tax Tips and Weekly Financial Blog for 2023

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To err is human and errors happen sometimes, especially if you must hurriedly prepare for your
tax returns like Charlie. But to Charlie’s relief and for many like him, there are some options. So,
this week we will discuss how to correct any information that you accidentally omit from or put
incorrectly on your tax return.

The rush is over, and your personal tax return is done for another year. Or so you thought right
up to the moment you discovered information that you forgot to include. What do you do next?
The action you take depends on the type of information you need to correct.

For instance, if you reported all your income on the return you mailed to the IRS, but you
realized you forgot to attach a copy of your Wage Statement, or W-2, the answer is, do nothing.
Eventually the IRS will ask for the missing form and at that time you can send it in. Other
mistakes made are omitting income or deductions, or finding you are eligible for tax credits, in
which case you may have to amend your tax return.

As a rule, if the information you omitted increases the tax you owe, the sooner you file, the
cheaper it will be, due to penalties and interest. On the other side, if the correction results in less
tax owed, the earlier you file, the sooner you will receive any refund that is due.

Here are the top ten things to know about filing an amended tax return:

1. Use Form 1040X, Amended U.S. Individual Income Tax Return, to correct errors on your
tax return. You must file an amended return form on paper. It can’t be e-filed. Remember
that if you file state income taxes, then filing an amended Federal return requires that an
amended State return also needs to be filed.

2. You usually should file an amended tax return if you made an error claiming your filing
status, income, deductions or credits on your original return.

3. You normally don’t need to file an amended return to correct math errors. The IRS will
automatically make those changes for you. Also, do not file an amended return because you
forgot to attach tax forms, such as a W-2 or schedule. The IRS will usually send you a
request for those.

4. You usually have three years from the date you filed your original tax return to file Form
1040X to claim a refund. You can file it within two years from the date you paid the tax if
that date is later. That means the last day for most people to file a 2018 claim for a refund is
April 15, 2022. See the 1040X instructions for special rules that apply to certain claims.

5. If you are amending more than one tax return, prepare a 1040X for each year. You should
mail each year in separate envelopes. Note the tax year of the return you are amending at the
top of Form 1040X. Check the form’s instructions for where to mail your return.

6. If you use other IRS forms or schedules to make changes, make sure to attach them to your
Form 1040X.

7. If you are due for a refund from your original return, wait to receive that refund before filing
Form 1040X to claim an added refund. Amended returns take up to 12 weeks to process. You
may spend your original refund while you wait for any added refund.

8. If you owe more tax, file your Form 1040X and pay the tax as soon as possible. This will
reduce any interest and penalties.

9. You can track the status of your amended tax return three weeks after you file with ‘Where’s
My Amended Return?’ This tool is available on IRS.gov or by phone on 866-464-2050. It’s
available in English and in Spanish. The tool can track the status of an amended return for the
current year and up to three years back.

10. To use ‘Where’s My Amended Return?’ enter your taxpayer identification number, which is
usually your Social Security number. You will also need your date of birth and zip code. If
you have filed amended returns for multiple years, select each year one by one.

Make Plans Now for Next Year’s Tax Return

Most people stop thinking about taxes after they file their tax return. But there’s no better time to
start tax planning than right now. And it’s never too early to set up a smart record-keeping
system.

Here are six IRS tips to help you start planning for this year’s taxes:

1. Act when life changes occur.
Some life events, like a change in marital status, the birth of a child or buying a home, can
change the amount of taxes you owe. When such events occur during the year, you may need
to change the amount of tax taken out of your pay. To do that, you must file a new Form W-
4, Employee’s Withholding Allowance Certificate, with your employer. Use the IRS
Withholding Calculator on www.IRS.gov to help you fill out the form. If you receive
advance payments of the premium tax credit it is important that you report changes in
circumstances, such as changes in your income or family size.

2. Keep records safe.
Put your earlier tax return and supporting records in a safe place. That way if you ever need
to refer to your return, you’ll know where to find it. For example, you may need a copy of
your return if you apply for a home loan or financial aid. You can also use it as a guide when
you do next year’s tax return.

3. Stay organized.
Make sure your family puts tax records in the same place during the year. This will prevent a
search for misplaced records, come tax time next year.
Create folders using your last year’s tax return, looking at the expenses and the income that
you recorded just days ago. For instance, medical expenses, income, charity, interest
expense, and taxes should all be categorized in different folders. This way throughout the rest
of the year you can simply throw your source documents into these envelopes and be better
organized for year-end.

4. Shop for a tax professional.
If you want to hire a tax professional to help you with tax planning, start your search now.
Choose a tax preparer wisely. You are responsible for the accuracy of your tax returns, no
matter who prepares it. Find a preparer who is licensed and open all year. Look for a
Certified Public Accountant (CPA), Enrolled Agent (EA), or Attorney. These tax
professionals are the only ones who can represent you before the IRS!

5. Think about itemizing.
If you usually claim a standard deduction on your tax return, you may be able to lower your
taxes if you itemize deductions instead. A donation to charity could mean some tax savings.
See the instructions for Schedule A, Itemized Deductions, for a list of deductions.

6. Keep up with changes.
Subscribe to IRS Tax Tips to get emails about tax law changes, how to save money and much
more. You can also get Tips on IRS.gov or IRS2Go, the IRS’s mobile app. And you can
sign up for free tax tips from our office at any time, by sending an email to
[email protected], or by subscribing to YouTube.com/AZMONEYGUY and on
social media as well.

Call today, don’t delay! See how this affects you. We can be reached at 602-264-9331 and on all social media under azmoneyguy.

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Get Expert Tax Advice from an expert

Mr. Hockensmith has been a guest newscaster for national and local TV stations in Phoenix since 1995, broadcasting financial and tax topics to the general pubic. He has written tax and accounting articles for both national and local newspapers and professional journals. He has been a public speaker nationally and locally on tax, accounting, financial planning and economics since 1992. He was a Disaster Reservist at the Federal Emergency Management Agency, for many years after his military service. He served as a Colonel with the US Army, retiring from military service after 36 years in 2008. Early in his accounting career, he was a Accountant and Consultant with Arthur Andersen CPA’s and Ernst & Young CPA’s.

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