Overpayment of taxes from the from prior year

[dianejaye]

The IRS sent me a notification that the over payment of taxes I asked to apply to the following year was off by I think 40.00. That still leaves me with a significant credit of over 4,000. But should I just override the incorrect amount on this year's return or do I have to amend something? I have no idea what would need amending as they didn't say what the issue was.

[fanfare]

On your tax return, enter the correct amount of refund applied to this year, not the wrong amount. Or,

use your larger amount and IRS will reduce it again 

if you owe that may result in interest and penalties.

you need to know the exact dollar amount of reduction by the IRS.

If you look at your IRS account at IRS.gov, it will tell you what credits you have.

@dianejaye 

[Mike9241]

@dianejaye if you override you will not be able to e-file. 

[dianejaye]

I don't electronically file, and I don't want to so that's not at all my concern.  I just found the actual notice and they are saying I miscalculated my self-employment tax and they changed the amount and if I don't agree to contact them. So now I'm guessing I should just override it on the next return and put the corrected amount owned in.  Pleas advise. Thank you.

[fanfare]

On your tax return, enter the correct amount of refund applied to this year, not the wrong amount. 

@dianejaye 

[Critter-3]

First you really really should efile the returns ... it is free and keeps the return from being entered incorrectly by the data input operators at the IRS ( error rate was posted by IRS was  25% or more ).  Are you sure that your return was wrong and this was not a data entry error by the IRS ?    If you use the TT program a math error is highly unlikely.   Review the return and the IRS notice carefully.   

Then to address the change in the refund applied ... you can either go in and change this in the program now so the correct info is passed thru to next year  OR  make a note to change it when you complete the 2023 return next year.  

[dianejaye]

Okay, so just to clarify this was my 2021 return and I filed the extension for my 2022 return due Oct 15,2023.

Are you saying to go in TT and change the amount of credit for 2022 when I start the 2022 return, and make it what the IRS says it should be according to their notice so it will be correct for the 2022 return?

[fanfare]

On your tax return, enter the correct amount of refund applied to this year, not the wrong amount. 

@dianejaye 

[VolvoGirl · Accepted solution]

Yes.   If it is applying your last year's refund to this year and you need to remove it or change it.....

Go to

Federal Taxes

Deductions and Credits

Then scroll way down to Estimates and Other Taxes

Other Income Taxes - Click the Start or Update button

Next page scroll down to 2021 Refund Applied to 2022

Click Start or Update and then delete the amount