I need to amend my tax return for 2017, as my W2 was reported wrongly, and I know that I will need to file a 1040x. I have already received my tax refund through direct deposit from the wrongly reported W2, and I was wondering how the IRS would take that money back? Would they retract the whole refund from by bank account, then issue a new refund, or would I be handed a bill by the IRS requiring me to pay back the difference from the old and new tax return?
No, the IRS will not automatically retract that refund from your bank account if you need to Amend your Return.
Once you receive your corrected Form W-2 you can complete your Form 1040X, Amended Return. If your Form 1040X shows a Refund, the IRS will issue you an additional check for this Refund. If your Form Form 1040X shows a Balance Due, you will need to submit payment to the IRS with your Amended Return.
So basically, if the incorrect Form W-2 caused your original refund to be higher than it should have been, you will owe some of your original refund back. On the other hand, if the incorrect Form W-2 caused your refund to be lower than it should have been, you will receive another check from the IRS for the difference.
Check out the TurboTax FAQ regarding how to Amend your return below:
No, the IRS will not automatically retract that refund from your bank account if you need to Amend your Return.
Once you receive your corrected Form W-2 you can complete your Form 1040X, Amended Return. If your Form 1040X shows a Refund, the IRS will issue you an additional check for this Refund. If your Form Form 1040X shows a Balance Due, you will need to submit payment to the IRS with your Amended Return.
So basically, if the incorrect Form W-2 caused your original refund to be higher than it should have been, you will owe some of your original refund back. On the other hand, if the incorrect Form W-2 caused your refund to be lower than it should have been, you will receive another check from the IRS for the difference.
Check out the TurboTax FAQ regarding how to Amend your return below: