Oops! How to Correct a Mistake on Your Filed Taxes

Posted by & filed under taxes .

By
Alden Wicker

Sending off your completed tax return is an amazing feeling. Goodbye to all that work until next year!

That is, until you realize you’ve made a mistake.

Maybe an extra 1099 came in the mail. Or you read one of our many tax articles and found out you missed a huge credit that could save you a couple thou. Ummm, what next?

Mistakes happen. So the IRS has a special form just for you: the 1040X. It’s what you use to file an amended return.
Should I File an Amendment?

File an amendment if you:

Claimed a dependent you shouldn’t have, or now realize you can claim a dependent you didn’t
Need to change your income, like if you forgot to report some freelancing gigs or interest income
Need to add or eliminate credits or deductions
Need to change your personal exemptions
Need to report additional withholding

Don’t file an amendment if:

You made a math error in adding or subtracting line items. The IRS will correct these for you.

What if you made a mistake that means you owe the IRS more in taxes, but the IRS didn’t notice? Can’t you just let it slide?

Bad idea. Besides the fact that this is tax fraud, if the IRS does discover this, you will have to pay the tax you owe plus interest that has accrued on it. It’s worth it to make sure you’re all buttoned up.
When You Can File an Amendment

If you filed before the deadline (which is usually April 15th), then you have three years from the deadline date.

how to fix mistake on tax formSo, let’s say that back when you filed taxes in 2010, you failed to claim a deduction for closing costs you incurred in 2009 (and you realized this after reading our post for homeowners). You can file an amended return to claim that deduction up until April 15th 2013, which is three years after the April 15th, 2010 filing deadline.

Let’s say you had a similar situation as above, but you couldn’t pay your taxes outright. You ended up paying the IRS in installments and finally paid off the last of your taxes in June 1, 2011. The IRS gives you more leeway here, giving you two years from when you paid off your taxes or three years from the filing date—whichever is longer—to file an amendment. So in this case, you can file an amendment up until June 1, 2013, which is two years after you finished paying for your 2009 taxes. (Find out what to do if you owe taxes and can’t pay.)

Posted on Jan 31, 2013 By Learnvest

Introducing Taxhub

Posted by & filed under taxes .

A new alternative to both the online do-it-yourself and the brick-and-mortar tax franchise methods of filing personal income tax returns is now available. Taxhub™, a New York City based startup, has launched a website that recreates the experience of going to a full service tax prep franchise. Personal communication channels and document sharing over the internet has significantly evolved in the last 5 years opening the doors for this new method of filing tax returns. Their secure portal makes document sharing so convenient that customers are even able to take a picture of their tax documents with their smart phone and text them directly to the portal. Due to the significant cost savings from not having hundreds of retail locations, this service can be offered at a significant discount, as compared to traditional brick-and-mortar full-service tax prep franchises.

Taxhub™ is committed to addressing recent concerns over identity theft, and in doing so provides a knowledge-based identity verification software solution, powered by Experian®. This verification process has recently been mandated by the IRS through changes in their electronic signature protocol which requires customers to verify their identity through a series of questions about their financial history taken from credit bureaus and other municipal databases.

This new method hopes to gives customers a cheaper alternative to traditional tax prep franchises. The Company founder, George Birrell, CPA, speculates that this new method will eventually take a significant market share from traditional brick-and-mortar retail locations much like retail video stores such as Blockbuster® were replaced in the 2000’s. He even thinks that this method can take some of the market share of online do-it-yourself websites as customers realize the price differential between DIY sites and this new method is much smaller than expected.

The company has been privately funded up to this point but, as public response has been extremely positive, is currently courting venture capital firms to be able to meet customer demand.

About Taxhub™:

GB Taxportunity, LLC dba. Taxhub™ is a New York based investor funded startup. At Taxhub™, we believe it’s time to bring the transparency of the new economy to places that haven’t embraced it yet. And the tax business is one of them. There is no excuse not to innovate, and offer your customers more and more every day. And that’s our pledge, to you.