Made a Mistake on Your Tax Return Here’s What to Do Next

Filing your taxes can feel like a big relief, especially once you finally hit submit and know they are done for the year. But what happens if a few days or even a few weeks later you realize you made a mistake?

Maybe you forgot about a 1099, entered the wrong amount somewhere, missed a deduction, or received another tax document after you already filed. It happens more often than you might think, and fortunately, most tax return mistakes can be corrected.

The first thing to determine is whether the mistake actually requires you to amend your return. The IRS can automatically correct some simple math errors and may contact you if additional information is needed. However, if you reported the wrong income, filing status, deductions, credits, dependents, or other information that changes your tax liability, you may need to file an amended return.

For most individual taxpayers, corrections are made using Form 1040-X, Amended U.S. Individual Income Tax Return. This allows you to show what was originally reported, what needs to be changed, and the reason for the correction.

One mistake that should not be ignored is forgetting to report income. Employers, banks, investment companies, and other businesses generally send copies of tax documents such as W-2s and 1099s to the IRS as well. If the income reported on your tax return does not match the information the IRS receives, there is a good chance they will eventually notice the difference.

If correcting the mistake means you owe additional taxes, it is usually better to take care of it sooner rather than later. Depending on the circumstances, interest and penalties can continue to add up while the balance remains unpaid.

On the other hand, you may discover that the mistake means the IRS actually owes you more money. Perhaps you forgot a deduction, missed a tax credit, or reported something incorrectly that resulted in paying too much tax. Filing an amended return may allow you to claim the additional refund, although there are deadlines for doing so.

It is also important to remember that changing your federal tax return could affect your state return. If you need to amend your federal return, your state taxes should be reviewed at the same time to determine whether another correction is necessary.

If you have already received a notice from the IRS about the mistake, don’t automatically send in an amended return. The IRS may have already made an adjustment or may simply need additional information from you. Filing another return while the IRS is already working on the issue could make things more complicated.

The biggest thing to remember is that discovering a mistake on your tax return does not automatically mean you are in serious trouble. Mistakes happen. What matters is recognizing the problem, determining whether it needs to be corrected, and taking care of it properly.

If you discover an error on a tax return you have already filed and aren’t sure what to do next, TaxPointe can help. Our team can review your return, determine whether an amendment is necessary, and help you make sure the issue is handled correctly.

Have questions about a tax return you’ve already filed? Contact TaxPointe today to speak with our team.

This information is provided for general educational purposes and is not intended as individualized tax advice.