What if <gasp> you unexpectedly receive a tax form after you’ve already filed your tax return with the IRS? Or, legislation is signed that retroactively changes a tax deduction or credit from a tax year that you’ve already filed for? Or, perhaps you realize you never received a form to begin with. Or, maybe you forgot to claim a deduction or credit that you were eligible for.
First, relax, we got this. There is a simple way to remedy each of these scenarios through the process of filing an amended 1040 tax return.
What is an Amended Tax Return?
An amended tax return is a way for you to correct an incomplete or inaccurate tax return that you have previously filed. When you file an amendment, you submit the new and/or corrected documentation, along with a form that signals you are making an amendment, as well as any payments due.
If you Haven’t Already Filed, Opt for a Tax Extension Versus a Future Amendment
If you are waiting on a form or running out of time to complete your return by the April tax deadline, then your best move is to file a tax extension. Note that the extension must be postmarked by the tax deadline. A tax extension will typically get you an additional 6 months from the April tax deadline.
A tax extension will be much less painful than filing an amended return. Note, however, that this doesn’t let you off the hook for paying taxes due (with the information that you presently have on hand). Taxes due are still due by the standard tax deadline.
If filing an extension isn’t an option or even relevant, then you will want to complete the following steps to amend your tax return.
Step 1: Gather Your Tax Return & Amended Forms
If you know that you will need to file an amended tax return, first gather your original return, plus any forms that will need to be amended.
Step 2: Fill Out IRS Form 1040X (with or without the Help of Tax Software)
Next, you’ll need to fill out IRS Form 1040X – the official form from the IRS that is needed to amend a tax return.
The best tax software programs should all be able to help walk you through the process of filling out Form 1040X (and if they don’t, you should probably switch).
For example, when logging in to H&R Block (after I filed my return), I see this option on the home screen:
If you haven’t used tax software, and filed a simple paper form instead, you will need to download Form 1040X. Fortunately, the form also comes with comprehensive instructions that you can follow for guidance.
Part III of 1040X allows you to write out an explanation of the changes that you are making.
Step 3: Submit Your Amended Return with Amended Forms
After completing your amended return, submit Form 1040X, along with any amended forms and other paperwork. If your amendment(s) result in additional taxes due, you should include the additional tax payment with the amended return. This can help to minimize interest and penalties that may be due, since you are technically making a late payment.
If you feel that you are due a tax refund (or additional refund) from the amendments, expect an 8-12 week delay for the IRS to process your amended return.
Time Limit to File an Amended Return
Note that for most taxpayers, the IRS limits the amount of time that you have to file an amended tax return to 3 years from the date that you file the original return. However, I recommend you keep your tax records longer.
See – that wasn’t hard, was it?