Filed 2021 Taxes with wrong capital gains accounting method, can I amend?

[MikeyMiner629]

Greetings,

As the title suggests, I just realized I filed my 2021 taxes with the wrong accounting method for capital gains. 

I've been investing in crypt for quite some time.  I've been using the same tax software to determine gains/losses every year.  I have always used the LIFO accounting method.  Last year, I was playing with the software and noticed an option called "OPTI" and generated a report with that as my method to see what it would look like.  It turns out I submitted that report instead of the LIFO report I generated.  

Is it possible for me to amend my return from last year with the LIFO report?  I believe the only visible change on my report would be the total capital gains and the accompanying printout of the taxable events / trades.  I'd like to amend because I have filed LIFO every year, meant to file LIFO last year, and plan to file LIFO in future years ... seems important to be consistent.  I also would have shown less gains last year with LIFO ... not sure how that works, but I definitely paid too much in gains last year because of this mistake.

Thanks!

[Anonymous_]

@Mike9241 

[MikeyMiner629]

Shamelessly bumping this to see if anyone has an answer 🙂  

If not, would anyone here have suggestions on how to proceed to find this answer?  Is this something where I should contact a TurboTax professional or another CPA?  Or try to get ahold of the IRS directly?  Or something else?

[Anonymous_ · Accepted solution]

See https://www.irs.gov/instructions/i3115

If this constitutes an actual change in accounting method (which I am not sure it does), you would have to file Form 3115, which typically requires professional intervention.

Otherwise, I believe you would have needed to provide your broker with instructions at the time of the transactions (and, if not, you cannot alter it at this point).

[fanfare]

It is not a change that requires any special forms.

It works exactly as you described it in your initial post.

Hopefully IRS will accept your explanation since you are asking for tax back.

@MikeyMiner629 

[MikeyMiner629]

Thank you, @fanfare !  I will plan on moving forward with a normal amend, with the only changes being as mentioned.

I'll make a note to come back and update this thread if the IRS tells me I've done something wrong in this process or does not refund me my overpaid taxes, so others who might end up in this situation can see what happened.  If I post nothing, assume it all worked out!