Other Tax Questions
Questions and comments on other topics covered in Fairmark.com, such as UTMA accounts, and any tax questions that don't fit our other categories.
Problem w/ Amended Return
Posted by: kaneohe, June 1, 2017 12:16AM
E-Filed taxpayer's original return showing tax due of $1200 to be paid later. Within a week taxpayer discovered some errors so created amended return showing
only $400 due. Advised taxpayer to wait a month before sending amended return,supporting docs, and $400 check.

Taxpayer mailed amended return after 3+ wks w/ $400 check. Taxpayer just received a notice that IRS wants him to pay $800 balance.

Does this make any sense? Could sending in amended return a bit early have created this problem? It's almost as if for the amended return, all they saw was the check but not the 1040X.


Re: Problem w/ Amended Return
Posted by: tomd37, June 1, 2017 02:34AM
I never suggest the taxpayer submit an amended return until they have concrete evidence of the original return being complete; that is accepted by the IRS and either refund received (if applicable) or payment received and processed by IRS (check clearing TP's bank)

I personally think the 1040X was submitted too early.

Tom D.

Re: Problem w/ Amended Return
Posted by: kaneohe, June 1, 2017 01:13PM
Thanks for your input , Tom. In this case, taxpayer didn't want to pay the original large amount, only to have to wait a long time to get the the large refund so
thought that paying the small correct amount was more satisfying. Thus there was no check to be cashed from the original return and taxpayer didn't want to wait too long to pay the smaller correct amount and be dinged by penalties.


Re: Problem w/ Amended Return
Posted by: motax, June 1, 2017 01:38PM
This makes sense to me. The IRS processes e-file returns very quickly (unless a math error is discovered). Also, checks are processed a lot faster than 1040X returns. It can take months until the IRS processes the 1040X.
The IRS system shows the balance due from the e-file and the check posted from the 1040X. The IRS is required to generate a balance due notice whenever these systems show an unpaid balance. In this case, it will covered by the amended return. But, they didn't know that at the time.

I think you advised the client correctly.

Re: Problem w/ Amended Return
Posted by: kaneohe, June 1, 2017 01:48PM
Thanks, motax, that makes sense. So basically they saw the check but not the 1040X. I was thinking there might be some seat-of-the- pants sense involved since the 1040X was there but perhaps check and 1040X are physically separated at some point and nobody sees the whole picture. I guess everything will fix itself at some point. Taxpayer was going to respond to notice with some words and resend the 1040X. I wonder if resending the 1040X will confuse them?

Re: Problem w/ Amended Return
Posted by: motax, June 1, 2017 02:36PM
I would not resend the 1040X. The taxpayer could call the 800 number and advise them that a 1040X has been submitted. The client service rep can make a note on the file that an amended return has been submitted and no balance will be owed when processed.

Submitting another 1040X could create problems with duplicate returns and neither one could get processed.

Re: Problem w/ Amended Return
Posted by: kaneohe, June 1, 2017 09:05PM
Thanks, motax. Advised taxpayer to do same.



Sorry, only registered users may post in this forum.