You Filed Your Taxes Wrong
‘Tis the season to get your taxes done! If you’re like most business owners, tax season is not greeted with warm cheer. It requires a great deal of paperwork that may need to be dug up from 11 months ago. It takes mental recall of various purchases and expenses. It takes a high-priced professional trained in just taxes to crunch all these numbers.
So naturally, to err is human. To 404 error, is software.
The IRS may or may not catch that error. But what if you did, months or years, after filing? Here’s what you need to know:
HOW FAR BACK CAN I AMEND?
To claim an additional refund, you must file an amended return within three years of the original tax due date or within two years of the date you paid the income tax, whichever date is later. Most people catch their tax return error when they get back the wrong refund amount or when they file the next year.
What Do I File?
To amend a return after filing taxes wrong, you will need to complete Form 1040X, also known as the Amended U.S. Individual Income Tax Return. You must use the information from your original tax return and amend the portion with the errors. If you are using Form 1040X to claim a refund, the IRS requests that you wait until you receive your original refund before filing Form 1040X. If you owe additional taxes, file the amended return and pay the tax immediately to avoid interest and penalties. Full instructions for completing the form are on the IRS website.
Do I Get Less Or More Money?
That would depend on where you went wrong filing and what you usually claim on your taxes. If you forgot to claim additional gross income, you may be taxed more, or you may be entitled more money refund that was withheld. What’s important is that your business is honest with taxes, as the IRS can audit your returns up to three years after you’ve filed. Selections are random, so always better to be safe than sorry.
Will I Get Penalized?
Tax forms are full of confusing and foreign boxes to check.. Or leave unchecked… Or number. About 4% of taxes (about 6 million) are amended every year. If you filed your taxes wrong, don’t freak out. It happens, and it can be fixed!
Category: Small Business Finance