Good Morning Tom,

Recap: I called you the other day on behalf of my friend “another provider”. She had her 2011 taxes done by a professional “all was done incorrectly”. She has decided to amend them, we have a few questions on this process.

Ok, so we are using the 2011 TurboTax desk top version; what we did was check the box to amend a 2011 tax return. TT has us enter all the correct information for 2011, TT transfers all the information to form 1040x column C and allows us to manually input the incorrect information that was original filed in column A.

Note: I’m using your 2011 Tax Work Book as a guide…

My questions:

1. What forms does she mail to the irs?
Form 1040x only? The entire re-done 2011 tax return? Only the forms affected by the amendment?

2. Dose the amended tax form 1040x takes into account the changes made to the business information also?

3. The biggest error on the original 2011 return was the deduction taken on her vehicle; this gave her a $12,000 lost for 2011. When it should be $2,121.00
Does she need to file any additional form due to the vehicle error?

4. Can she mail in her 2012 return with the amend 2011? Or should she wait until the 2011 return is corrected by the irs?
Note: the 2012 return will be completed base off the corrected 2011 return.

5. At this point form 1040x shows she ‘s due a refund of $4,018.00...although she did receive a refund in 2011 of $6,852

2011 Incorrect Forms:

1040 Line 12, 22, 37, 38, 41, 43, 54, 64a,65,72-74a
Sch-C Profit/Loss Line 1b, 1d-7, 9(no car expenses claimed originally)
13, 24b, 27a, 28-31
8829 Line (all numbers we’re incorrect, T/S, Hours home used was enter wrong) House expenses, home was not deprecated
4562 Vehicle was claimed incorrectly (date of purchase, date placed in service, purchase price, miles, business usage percentage, and the entire allowed first year deprecation for a new vehicle purchase was claimed $11060 as well as the limitation for a vehicle first used for business in 2011 $3060.

Thank so much for your help…and the very detailed books you provide.

Hope I explained everything correctly.

Reply

1. Send in Form 1040X as well as any other tax forms that are changed because of the amending (Form 4562, Schedule SE, 8829, Schedule C).

2. Yes.

3. Resubmit the corrected form on which the vehicle expense was first claimed.

4. Don't send the amended form with the 2012 tax return. Send them by separate envelopes. Send the amended 2011 return first. Wait a few weeks and then send in 2012.

Reply

Ok, thank you Tom

I'm double checking my work (I don't think the $4018 additional refund is correct).

Form 1040x States

Refund or Amount you owe:
"Original 2011 Return Overpayment Smart Worksheet"
A. Overpayment if any as shown on the original return or as previously adjusted by the IRS (not including penalties)

Would this be the amount she received as a tax refund in 2011? ($6852.00)
If so that would have her owing the IRS back $2834...this seems right to me...since she received some incorrect deductions in the first place.

Thanks.

Reply

Yes, report the refund here.

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The reason for sending the 2011 first and then 2012 a few weeks later...Would be? if she's due a refund for 2012 and owe for 2011...then the IRS will just hold her 2012 refund to pay on the 2011 taxes...right? Her 2012 shows a refund due to her that she would like to get.

Or is this a IRS rule...to send the amend first?


Thanks Tom....I can't wait March 23rd...you will be in town!

Reply

There is no IRS rule on this point. Send the 2011 first because if the IRS processes 2012 first and then gets the amended 2011, they may have to revise the 2012 return.

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