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marcuscato
Level 3

When to file amendment (if it reduces my refund or has me paying IRS)?

Hello

 

Status of my original return:

- Waiting on Federal Tax Refund (looks it it may take several weeks or months)

- Received State Tax Refund

 

I will be getting a corrected W2 soon (4-6 weeks). It has a good potential to reduce my claimed refund (or worse, may have me paying the IRS/State). 

 

Should I wait for my Federal Tax Refund to file an amendment after I get the W2C or should I file immediately after I get W2C without waiting for the refund. 

 

I saw following on the IRS website:
 
"If you're filing an amended tax return to claim an additional refund, wait until you receive your original tax refund before filing Form 1040X. If you owe additional taxes with Form 1040X, pay the tax with the return or as soon as possible to minimize interest and penalties."

 

11 Replies
fanfare
Level 15

When to file amendment (if it reduces my refund or has me paying IRS)?

the quote from IRS that you posted answers your question.

marcuscato
Level 3

When to file amendment (if it reduces my refund or has me paying IRS)?

What if it is a reduction in refund instead of me paying the IRS back? Sorry if the question is basic - I am not clear if amendments calculate a delta from the original refund or has the complete refund

fanfare
Level 15

When to file amendment (if it reduces my refund or has me paying IRS)?

if your refund is reduced, 1040-X will show that you owe the IRS the difference.

It was due May 17 and you will be charged interest until you pay it.

 

 If that's not what you see on 1040-X -- review it carefully -- you filled it out incorrectly.

marcuscato
Level 3

When to file amendment (if it reduces my refund or has me paying IRS)?

So, if say the original refund was $100 and the amendment caused the IRS to owe me only $25, then I would have to send in a cheque of $75? Given I have not received the original refund, can't I simply just tell IRS to just send me $25 without me paying anything? I am not sure why I must be paying an interest when I never got any money that I held beyond May 17th.

 

 

VolvoGirl
Level 15

When to file amendment (if it reduces my refund or has me paying IRS)?

DO NOT FILE the Amended return until your first original return is done processing and you get the first refund.  The IRS May change your original return for you.  Why are you amending?

VolvoGirl
Level 15

When to file amendment (if it reduces my refund or has me paying IRS)?

The amended return is only for the difference you get back or owe.  I think the cover sheet shows what the original return WOULD have been if you did it right the first time.

 

Go by the actual 1040X.  Line 18 should be your original refund amount and line 22 should be your additional refund.  If you paid on your original return it will be on line 16.  If there is an amount owed with the amendment, it will be on line 20.

 

If you have a tax due, do not send the 1040V.  Just include a check with the 1040X.  Ignore the 1040V.  That is for the original return or what the original return would have been if it didn’t need correcting.  Don’t pay the amount on the 1040V.  Pay the amount on the actual 1040X.

marcuscato
Level 3

When to file amendment (if it reduces my refund or has me paying IRS)?

Hi @VolvoGirl to answer your questions

1) My employer is issuing me a W2C.

2) They said it will take 4-6 weeks from this week to be generated.

3) There is a good chance I wouldn't have gotten my Federal Tax return by then. I got my NY state return a while ago.

 

The W2C has potential to reduce my federal refund slightly (couple of hundred dollars is my guess) or worse have me pay IRS.  If IRS takes say total of 10 months to process my original refund, even if they make the correction on their own, won't they charge me 10 months of interest and penalties? Is it not better to file myself to avoid that interest/penalties? I heard they are pretty stiff. Also, in case of the NY state, they cannot make a self-correction given they have already issued me a refund - in case of state, I am anticipating no or small difference.

 

Sorry if my question is basic - I have never filed an amendment and I am confused.

Critter-3
Level 15

When to file amendment (if it reduces my refund or has me paying IRS)?

Wait to amend the return.

 

If you wind up owing on the amended return you will make the payment with the amended return.

 

Stop trying to make this situation more difficult than it is. You have 3 years to amend so don't fret about this that much.

marcuscato
Level 3

When to file amendment (if it reduces my refund or has me paying IRS)?

Yes, I have 3 years, but if I owe taxes, then I would be paying 3 years of interest and possibly penalties as well?

marcuscato
Level 3

When to file amendment (if it reduces my refund or has me paying IRS)?

@Critter-3 and @VolvoGirl  Is there a chance that IRS will self-correct/adjust my return when it receives the copy of W2C from my employer? Or does this always need an amendment from my side? IRS has accepted my return but has not processed the original refund amount and I am hoping they will get the copy of W2C from my employer before they begin processing and be able to correct the mistake themselves and just send me a letter to explain the adjusted amount or bill to pay anything overdue.

Critter-3
Level 15

When to file amendment (if it reduces my refund or has me paying IRS)?

No they will not ... you must amend if the changes on the W-2 makes a difference to your return which not all changes will do. 

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