What If I Made a Mistake on My Tax Return

What if I made a mistake on my tax return? It is not uncommon for taxpayers to ask this question. If it is a mathematical error or you forgot to include a supporting paper, the IRS will catch it and send you a notice. If the mistake is something more, such as you've reported your income incorrectly, it's time to take action.

Period Of Limitations
The IRS allows taxpayers to make amendments to tax returns up to three years from the original tax year. For example, a taxpayer would have until 2010 to file an amended tax return for 2007. After three years, the period of limitations will expire, and the taxpayer can no longer make adjustments to that particular tax return.

Form 1040X
The IRS offers Form 1040X to make amendments to a tax return. This form allows the taxpayer to show what the original tax return information included, the new information and an opportunity to add why the changes are being made. Taxpayers should fill out the form and mail it to the specified address. If the resulting changes mean the taxpayer owes more to the IRS, the envelope should include a check for the amount. If the changes lead to an income tax refund, the IRS will process that and mail a check.

Correct Mistakes
Sometimes a taxpayer will feel too nervous about correcting a mistake on a previous year's tax return. The fear is that the IRS will penalize them with fees or an audit. In fact, the IRS encourages taxpayers to correct any honest mistakes and does not penalize outright. However, if the mistake results in additional taxes that need to be paid, the IRS may apply interest to the amount. Correcting the mistake as soon as possible will limit the interest amount applied to the taxes. If the mistake causes concern, you can always enlist income tax help from a professional tax preparer to assist in navigating the paperwork.

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