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While the tax-filing deadline may have passed, sometimes after filing people discover that they made a mistake.
While the IRS may not be widely known for being cool, they are actually not the worst when it comes to allowing you to correct mistakes (so long as you’re not a mob boss). Yes, there may be penalties, but it beats the alternative if you get busted for one of the many tax crimes. Heck, sometimes, you may actually get back money you shouldn't have paid.
Why Amend a Tax Return?
Simply put, if you failed to disclose income to the IRS, or claimed deductions or exemptions you are not entitled to, then amending might be a good idea, and you should probably consult with a tax attorney about doing so as soon as possible. Whether you just made an error, or didn't discover the income until after you filed, the longer you wait to amend, the more severe the financial penalty will be if you owe additional taxes. But, as noted, amending can ensure that the financial penalty doesn’t get any worse, and doesn't turn into a criminal penalty.
Perhaps the best reason to amend a return is if you discovered that you left money on the table in previous years. For instance, newly employed college grads often do not know that student loan interest is deductible, and may have not included that information on their returns. Luckily, if you are owed additional money from mistakes, so long as you amend within three-years, the IRS will actually still cut you a check.
When Shouldn't You Amend?
If you simply made a miscalculation, or forgot to include a tax form, you probably don't need to amend your taxes. The IRS will more than likely catch it, notify you, ask for more info, and ask for more money, if the mistake requires. If the mistake wasn't a mistake at all, you might want to have a consult with a tax attorney.
If the IRS doesn't catch the error, then you may still consider filing an amendment then so as to prevent the future risk, or to get back the money you are owed.