Do You Need to Fix Your Filed Tax Return?
It’s after April 15th and you’ve successfully filed your federal and state tax returns. That’s one more yearly project off your shoulders for 2006. Then you receive a corrected 1099-INT form from your local bank stating that your interest income for 2006 was really $102, not $62. Do you need to file your return again?
Did you read an IRS article online that declared that a 1/3 of the taxpayers didn’t take their telephone refund tax credit for 2006? You check your return and you don’t see that $60. What do you do? Or you used TurboTax for the first time and got something called an education credit. Can you go back and get that credit for past years? Or your state decided in March 2007 to agree with the IRS changes for 2006. How do you now get that teacher’s deduction on your state return? The answer to all of these scenarios is “you file an amended return.”
In the 1st scenario, $40 of interest income may seem too small an amount to file an amended return. It’s not. You are required to file a return with all of your taxable income. Also, the IRS will be double checking that same 1099-INT against your tax return. If the two don’t match, you will get an IRS letter.
When it comes to that one time only telephone refund, go for it. For details if you qualify (and most folks do), read Don’t Overlook Your Phone Refund! Since the IRS expected lots of taxpayers to miss this refund, they added a special line (line 15) to the 1040X form to keep the fix simple. In the Ready, Set, Do-Over section of the Kiplinger article, you’ll see easy steps to quickly fill out a Form 1040X for this refund manually.
If the fixes to your return are more than just the telephone refund (or you plan to have that telephone refund applied to your 2007 return), the best way to prepare your amended return is using TurboTax. Every year there are lots of questions about doing an amended tax return. This past year, TurboTax created a “webisode” on amending a return. It shows the step by step process for amending your federal and state tax returns using TurboTax.
There is an Amend Your Tax Return FAQ in the Community Support Site that answers all of your questions about amending a return, such as when can I file an amended return, how do I amend for the current/ prior years, and where do I mail it. You’ll see that there are different steps to follow depending if you have or have not made the corrections yet in TurboTax. There are separate FAQs that talk about those steps:
If it looks like you need to amend a return, add it to your summer must-do list. Take the time to see the read the FAQs and Webisode mentioned above. And get it done!