No matter how diligent you are at filing your taxes, chances are you're going to miss a deduction or credit at some point. If you realize that you forgot to claim something on a prior year's tax return, you can't just tack it on to the next return that you file, but you might be able to file an amended return to correct the prior year's return.
There's not a huge rush to amend your return, but that doesn't mean you should dawdle around -- the sooner you file the amended return, the sooner you get the money back. However, there's also the statute of limitations, which doesn't allow you to claim a refund more than three years after the tax filing deadline or two years after you filed the return, whichever is later. For example, if you file your federal tax return for 2012 on time, the three years starts running on April 15, 2013. So, you have until April 15, 2016, to submit your amended return.
To amend your return, you must file Form 1040X regardless of whether you used Form 1040, 1040A or 1040EZ to file the original return. On the form, you need to show the changes to the different line items on your return, including your adjusted gross income, itemized deductions and tax liability. Then, in Part III, you have to explain each of the changes you made. For example, say you forgot to claim your IRA contribution that would give you a $1,000 deduction, you would report your adjusted gross income as $1,000 lower because of the deduction. You would also adjust your tax bill accordingly. Then, in Part III you would explain you forgot to deduct your IRA contribution.
When you file your Form 1040X, include both any supporting documents or schedules used in figuring your amendments. For example, say you realized you didn't claim the retirement savings credit for your IRA contributions even though you were eligible. In addition to mailing in Form 1040X, you would also include a completed Form 8880 to show how you figured the credit. Alternatively, if you received a correct W-2 that showed you made less income than you originally reported, include a copy of that form with your amended return.
Submission and Processing
You must submit a paper copy of your amended return -- the IRS doesn't accept electronically filed amended returns. Where you send the amended return, however, depends on where you live. For example, if you live in Florida, it goes to the Department of the Treasury, Internal Revenue Service Center, Austin, TX 73301. But, if you're in Alaska, it goes to the Department of the Treasury, Internal Revenue Service Center, Fresno, CA 93888-0422. After submission, it typically takes eight to 12 weeks for the IRS to process the return.
- Internal Revenue Service: Amended Returns & Form 1040X
- Internal Revenue Service: Topic 308 -- Amended Returns
- Internal Revenue Service: Form 1040X
- IRS. "Amended Returns & Form 1040X." Accessed June 24, 2020.
- IRS. "Here Are Five Facts About the New Form 1040." Accessed June 24, 2020.
- IRS. "Tax Reform Basics for Individuals and Families." Accessed June 24, 2020.
- IRS. "IRS Audits." Accessed June 24, 2020.
Based in the Kansas City area, Mike specializes in personal finance and business topics. He has been writing since 2009 and has been published by "Quicken," "TurboTax," and "The Motley Fool."