Amended Tax Return

Definition

The term amended tax return is used to describe the process of providing a government agency with corrections to an income tax return for a prior year.   Amended federal income tax returns are filed with the Internal Revenue Service (IRS) using Form 1040X.

Explanation

If a taxpayer discovers an error on a previously filed tax return, they can file an amended return with the IRS using Form 1040X.  A three-year statute of limitation applies to returns that result in a refund to the taxpayer, while there is no limitation for amended returns that result in the payment of additional income tax.

Typically, a taxpayer would complete Form 1040X if they forgot to claim a deduction on their income tax return.  It's not necessary for taxpayers to complete this form to correct mathematical errors; systems used by the IRS will automatically make these corrections and notify the taxpayer of the adjustment to their return.

Form 1040X must be mailed to an IRS office and subsequent correspondence concerning the return will be mailed to the taxpayer.  The status of an amended tax return can be found on the IRS website, which provides the following status updates:

  • Received:  Form 1040X has been received by the IRS and is being processed.  Typically, it takes about three weeks for the IRS to acknowledge receipt of Form 1040X.
  • Adjusted:  The IRS has processed the amended return and an adjustment will occur.  This can include a refund of taxes paid, money due, or no change to the amount of taxes owed.  It can take the IRS up to 12 weeks to complete this step.
  • Completed:  Correspondence associated with the processing of the amended return has been mailed to the taxpayer.

Related Terms

tax bracket, tax shelter, Form 1040