"1) when amended return is filed, is it sufficient to include just this
new 1099-R, 1040X and corrected 1040? These are the only forms with
changes, yet TurboTax produced a 60+ page package, including a bunch of
forms with no changes (Schedule D, Form 8949, etc.) I am confused as to
what the IRS are expecting vs. TurboTax."
You only send in the Forms or Schedules that are part of your income tax return that have changed from your original "as filed" income tax return. That means you don't send in the 1099-R; the IRS already has that. There's also no need to send in the "corrected" Form 1040. It sounds like you only need to send in the Form 1040X. That form will include your write-up as to why you are amending.
"2) Since the original return was e-filed (no paper sent), do I now need
to include paper copies of W-2s with the paper amended return? Those
were not changed."
NO.
"3) what's the best way to explain this to IRS in the space provided?
Fidelity was very late, but we also overlooked a small amount in the
final check - is this a reasonable explanation?"
You should be able to reduce the explanation to just a few sentences. You're very sure that you didn't include the distribution as "wages"?
"4) Does filing 1040X appreciably increase odds of an audit?"
Nobody really knows but for this small amount I wouldn't lose a minute's worth of sleep over it.
Tom Young
