Amending your personal income tax return may seem overwhelming, but it’s a manageable process when you break it down step by step. In this guide, I’ll walk you through how to correct your return using IRS Form 1040-X.
Step 1: Gather Your Documents
Before we begin, make sure you have the following items:
- A copy of your original tax return (Form 1040)
- Form 1040-X, which you can download from the IRS website.
- Any supporting documentation related to the new change (for example, a 1099-INT form showing interest income)
Step 2: Identify the Reason for the Amendment
Let’s assume you received an additional $300 in interest income that wasn’t reported when you filed your original return. To fix this, you’ll need to amend your return to reflect the new total income.
Step 3: Update Your Adjusted Gross Income
Locate the Adjusted Gross Income (AGI) on your original return—typically found on line 11 of Form 1040. For this example, let’s say your original AGI was $60,000. With the additional $300 in interest income, your corrected AGI becomes $60,300.
It’s worth noting here that any changes to your tax return can require proof. To be on the safe side, it’s best to provide the proof when you file the amended tax return. Even if the IRS does not request it, you’ll make your life easier by providing it from day one. By including proof, you can help avoid delays or additional correspondence with the IRS.
Step 4: Recalculate Your Tax
Now, let’s go back to our example. Originally, you paid $3,000 in taxes based on the $60,000 income. With the extra $300 added, your updated tax liability increases by about $100, making the total tax owed $3,100.
Step 5: Consider Payments and Refunds
Let’s assume the following from your original return:
- You made $3,500 in total tax payments throughout the year.
- You received a $500 refund (since $3,500 in payments minus $3,000 in tax = $500 overpayment).
Now, with the revised tax of $3,100, your new refund would only be $400. However, since you already received a $500 refund or reimbursement, you now owe the IRS $100.
Step 6: Complete Form 1040-X
Lastly, it’s time to fill out Form 1040-X.
When filling out the form, be sure to:
- Fill out the explanation of changes section clearly in Part 2 of 1040-X.
- Attach any necessary forms or schedules that were affected.
- Include proof of the income change when possible.
Final Notes
If you have questions, be sure to contact a licensed tax professional for help with your specific situation.