Generally speaking, tax return mistakes are a lot more common than you probably realize. Taxes have grown complicated and COVID tax relief has made many changes; the paperwork required to file proper tax returns is often convoluted. This is especially true if you're filing your taxes yourself. The 2020 tax year certainly does not qualify as a "normal year" and 2021 was not any better together with the backlogs from 2020 tax year. Congress passed numerous tax laws before, during and after 2020 that apply to 2020 as well as 2021, making it two of the more complicated tax years in recent memory. Even seasoned tax professionals had a hard time digesting all of the changes that they and their clients are now dealing with, requiring hours of continuing education. All of this is to say that if you've just discovered that you've made a significant mistake on your tax return, the first thing you should do is stop and take a deep breath, and then call us. It happens. It's understandable. There are steps that you can take to correct the situation quickly — you just have to keep a few key things in mind, including that the mistake could be in your favor. Fixing Tax Return Mistakes - Here's What You Need to Know:
Many errors include not claiming tax benefits you are entitled to and cause you to pay more tax than required. You may have overstated or understated your income, received a late tax document or K-1. To correct issues on an already filed return you generally need to file an amended return. An amended return is used to make corrections to previously filed returns. The possible corrections include, but are not limited to:
If you catch the error prior to the filing due date of the return, instead of filing an amended return, you can file what’s called a “superseding return” to replace the original return. The difference is that when you file a superseding return you submit a complete new return to take the place of the one originally filed, while with an amended return, you fill out a special form (1040-X) and attach only back-up forms or schedules that pertain to the change. A sudden increase in your tax liability notwithstanding, it's again important to understand that errors on your income taxes aren't really worth stressing out about. The IRS understands that sometimes mistakes happen, and they have a variety of processes in place designed to help make things right. If you have received a notice from the IRS about an error on your tax return, don’t procrastinate in handling it – address the issue(s) raised by the IRS raised right away. The same applies if you have discovered an error. Either way, you can contact this office for assistance with responding to the IRS, preparing a superseding or an amended return, and requesting penalty abatement.
0 Comments
Leave a Reply. |
C&A Financial ServicesOne-stop for all your financial service needs. Archives
January 2022
Categories
All
|