There are multiple reasons one might need to file an amended tax return. Sometimes changes in the tax code are made retroactive, and by filing an amended return you can, say, claim a deduction that wasn’t available when you filed your original return.
But generally when you file an amended return it’s because you realize too late that you made a mistake. Fortunately, correcting your mistake by filing an amended return is not a difficult process.
It’s important to note, though, that for purely calculative errors, it is not appropriate to file an amended return. If you added where you should have subtracted, or subtracted where you should have added, the Internal Revenue Service (IRS) computers will catch and correct that sort of thing automatically.
An amended return is instead for cases where there is something inaccurate about the information you entered on your original return. Perhaps you received a W-2 or 1099 late after you had already filed, so now you realize you need to claim additional income. Or perhaps you didn’t know you were eligible for a certain deduction and so you left it off, and now you realize you are entitled to it and want to add it. Or perhaps you neglected to claim your college age son as a dependent because you thought he was claiming an exemption for himself on his own taxes, but then you find out he didn’t. In cases like these, you need to provide the corrected information to the IRS in order for your taxes to be computed accurately.
The IRS form for an amended return is the 1040X. Fill out the 1040X the same way you would a standard 1040 form. On the second page, you will be asked to provide a written explanation of why you are amending your return. State what changes you made and why, and be sure to include copies of any relevant documentation.
The deadline for submitting an amended return is three years from the due date of the original return. You must mail in the amended return, as e-filing is not available for Form 1040X. Be sure to enclose all necessary schedules and documentation, as well as payment if you owe additional taxes based on the new information.
You’ll want to be especially meticulous with an amended return, as a significantly higher percentage of amended returns than original returns are audited.
As a final note, don’t forget that if you made an error on your federal return, there’s a good chance this will affect any state or local income tax forms you had to file, so be sure to check those for errors, and find out the process for amending those returns if necessary.
As always, for further details and clarification, consult a qualified tax professional.