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Amended Tax Return CPA discusses IRS Form 1040X, Amended U.S. Individual Income Tax Return | Form 1040X CPA

Form 1040X instructions

I don’t work for the IRS but it seems logical that a 1040X, Amended U.S. Individual Income Tax Return, gets special attention. So accuracy is important. For a free phone consult call (910) 399-2705.

Form 1040X CPAs stay busy after April 15th, 2014. The IRS supposedly expects 5 million +/- 1040X, Amended U.S. Individual Income Tax Return(s) a year. Many legitimate reasons exist to file Form 1040X. I’ll offer a few tips I’ve learned over the years preparing amended tax returns and answer some FAQs. Hopefully this post helps you to understand the Form 1040x instructions.

Hi, I’m Gary Bode, CPA. Our virtual office, to my surprise, generated some specialties. Because we deal with a wider geographical area than most brick and mortar CPAs, I think we have a percentage of amended tax return clients. If you don’t have a local Form 1040X CPA, consider calling me for a free consult to see I can help.

I made a mistake on my business returns, can I amend them? Sure amended tax return CPAs file other amended returns than just IRS Form 1040X.

  • Payroll tax. 941-X, Adjusted Employer’s QUARTERLY Federal Tax Return or Claim for Refund.
  • Partnership tax returns. Form 1065X, Amended Return or Administrative Adjustment Request (AAR).
  • S Corporations. Form 1120-S, Form 1120S, U.S. Income Tax Return for an S Corporation. There’s no “X” return. You just file a new 1120S and check a few boxes to show it’s an amended tax return.

File an original tax return before filing Form 1040X, Amended U.S. Individual Income Tax Return  Duh. Don’t ask. I think some capable Folks just get scared with taxes and make foolish errors. Dealing with the IRS is stressful.

Will Form 1040X trigger an IRS tax audit?

Maybe. Many IRS Form 1040x issues are routine and probably wouldn’t trigger additional IRS red flags. Here’s how a Form 1040X CPA might approach IRS red flags.

  • Take the time to understand the tax issues involved.
  • Prepare an accurate Form 1040X.
  • Anticipate what the IRS might focus on.
  • Provide a concise explanation about the issues involved in the amended tax return.
  • Consider sending relevant documentation along with the return.

“Don’t let fear of the IRS keep you from filing a legitimate Form 1040X to claim a refund.”
– Gary Bode, amended tax return CPA

Can Form 1040X generate an IRS refund?

Absolutely. But there’s a three limit. So, in 2014, you can generate a refund for 2011, 2012 and 2013.

What if I’m past the three-year deadline for Form 1040X refunds?

Well you can perhaps decrease the tax due, penalties and interest for older Form 1040(s). Here’s a common example. Say you receive an IRS Notice demanding additional tax from an IRS Form 1099-C, Cancellation of Debt, for a rental property short sale in 2009. You can amend the 2009 tax return with Form 1040X to exclude the cancelled debt income on Form 1099-C using Form 982, Reduction of Tax Attributes. If you had filed a correct 2009 the loss on the rental real estate might have generated a refund. But you still eliminate the additional tax due by filing the amended tax return.

Don’t let Form 1040X, Amended U.S. Individual Income Tax Return, open additional tax issues!

Try to limit yourself to the relevant issues. You have to be accurate of course.

Do you have similar issues for other tax years?

I suggest you thoroughly understand the issues on IRS Form 1040 and your earlier and later tax reruns.

What sources of information exist beyond the Form 1040X instructions?

I think the Form 1040X instructions are well written. However, the instructions only cover how to present the underlying tax issues you’re amending. Specifically the Form 1040X instructions don’t offer help with the underlying issues.

When should I engage an amended tax return CPA to handle my 1040X?

Every case is different. Here are some guidelines.

  • How much tax is involved? If it’s only a few bucks a 1040X CPA wouldn’t be cost-effective.
  • Do you understand the underlying tax issues for 1040X?
  • Do you understand the Form 1040-X instructions?
  • Are there other tax issues involved beyond what the IRS asks about?
  • Do similar tax issues exist in other Form 1040(s)?
  • How stressful is it for you to deal with the manner? Some Clients find my fees worthwhile just on this point alone.

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