For a lot of Americans, the tax return deadline came and went without incident. For many, their returns were much like they always are: straightforward and relatively easy to file. But for some individuals, the process may not have been so simple.
The arrival of late tax documents or the realization that a deduction was not filed properly are just two things that could send the average taxpayer into a panic because of the threat of an audit. For people in this situation, the next few months may be the time to consider filing an amended tax return.
But when is it necessary to file an amended return? Sometimes, not as often as you may think.
A look at amended returns
When filing a tax return, the IRS asks taxpayers to be as accurate as possible, making sure to account for every dollar of income and every deduction. If auditors notice a discrepancy that you were aware of and failed to correct, you could face allegations of tax evasion, which is an incredibly serious matter.
But even the IRS understands that mistakes happen and admits that small mathematical and clerical errors typically do not require you to file an amended return. According to an IRS topic page regarding amended returns, there are several instances in which you should file an amended return, such as accounting for:
- Inaccurate information on a previously filed return
- Interest or penalties on investment accounts or loans
- Missed deductions or credits
- Additional income you didn’t claim on your initial filing
Basically, it’s up to you whether you file an amended return or not this year. Just remember, knowing about a considerable mistake and failing to correct it can lead to serious consequences that could end up requiring the skill of an experienced tax lawyer during legal proceedings.