Tax Filing - Early Bird Doesn't Get the Worm

[easysurfer]

Well, I did my taxes today, and e-filed both Fed and State via Turbotax.

Then I checked my email and see that one place I'm going to get a corrected 1099 form in about a couple of weeks. Grrrrrr!

The amount of interest on the corrected I expect to be small (maybe only a few bucks) and probably would not impact whether I pay or receive any more for this tax year.

But to be correct, I probably still should do an amended return?

...Note to self... In future, waitl until March 1 to start taxes.

 

[soupcxan]

Filing early increases your risk of an audit as well.

 

[heeyy_joe]

Personally I would not bother to amend.

 

[Original Wally]

Filing early increases your risk of an audit as well.

Not true. Early, late, extension - none of those factors are involved.

There are two main "reasons" for audits - TCMP - Taxpayer Complaince Measurement Program. This is totally random and is a complete stem-to-stern audit. The purpose of it is to compile a database of where ...ummm... "errors" are most likely to happen. Whether occupation, this deduction or that or whatever.

Then, each return is "run" against the database. To the extent that a return deviates from the "norm", or has items in high "error" areas, the return accumulates a dif score. High enough, it gets kicked out. That may or may NOT lead to an audit. It is first examined to see if there is a logical reason for the kickout. Then, if it warrents a further look, it is kicked to the audit division. Nornally this type of audit is limited to the one or two areas of concern. This all happens a year or so AFTER the returns are filed. Unrelated to timing of filing.

B-T-W, that database is one of the most closely guarded secrets of the Federal Govt.

 

[Original Wally]

But to be correct, I probably still should do an amended return?

I probably would. The 1099 matching program could cause it to kick out a letter to you - then you would have to reconcile to their list... and when the letter comes in a year or so, you may not have the records at your fingertips. Amend now while it is fresh in your mind.

 

[W2R]

Filing an amended return is easy. You can do it in TurboTax, although I believe TT will not e-file it. But you can print it out and send it by snail mail; I did that in 2008 anyway.

 

[easysurfer]

I did an amended return in 2008 too (my first year of ER and I had forgot two 1099-R forms).

I'm starting to think now that ER is bad for my tax-filing health with too much free time. All my w*rking years, I never needed to file an amended return. Probably I was too busy w*rking and didn't have the early jump at tax filing. Jumping the gun made me file too early both times.

 

[audreyh1]

We always wait until mid March before working on our taxes, just in case there is an amended 1099. One year we got an amended 1099 in the mail on April 16th - boy were we pithed.

 

[easysurfer]

Personally I would not bother to amend.

I went ahead and posted this same question on the turbotax community. Here is the reply I got (similar to your reply) from one of their 'superusers'

"For a few dollars difference I wouldn't bother with the amended return. If it results in you owing money, you will get a letter in a few months saying "we think your filing needs to be adjusted like this "xxx" so we think you owe us this" $xx". So then you mark the "I agree" box and pay them."

I had thought about this approach too.

 

[Dawg52]

We always wait until mid March before working on our taxes, just in case there is an amended 1099. One year we got an amended 1099 in the mail on April 16th - boy were we pithed.

Same here. Filed mid March one year and got a correction notice just a couple of days later. I now wait until around April 10th before transmitting the return. I usually owe anyway.

 

[Mulligan]

Ya, I got a little eager, too. I was off $50. I didn't pay enough attention that what I submitted was my Roth CD
interest statement, not my regular CD statement which didn't come until 2 weeks later. The CDs are about the same size so I didn't pay much attention to the statement like I should have. So I probably owe Uncle Sam about $12.50. They have already sent me my refund and it's in the bank. Oh well, it's their move next. I sleep well at night still. I reported my savings and checking account interest which were both under $10 and no form is sent on that, so I could have not reported it, but I did. My intentions were good anyways....

 

[easysurfer]

Here's a good write up about Amended Tax Returns:

Filing an Amended Tax Return Using IRS Form 1040X

Following this, I think my situation would fall under the latter...
"You should not file an amended return if you are only correcting math errors as the IRS computers will check your math and correct any errors in calculation. Math errors are errors in adding or subtracting items on your tax return."

Another way to state it, as Wally from "Leave It To Beaver" might say "No sense getting all shook up over it Beav"

 

[Animorph]

My correction was for a buck or two less income. Wasn't worth the hassle to claim less than a dollar in additional refund. But I do wait as long as possible now.

 

[RE2Boys]

I put myself on extension and deal with it about May 1. Of course, I do a good estimate using the standard deduction to check if I owe or not. If owe, check goes with extension.

But also worked on five returns today, so not up to looking at more.

If the change in the figures on a corrected 1099 does not change your tax liability, you won't usually hear from the IRS. If it increases your tax liability, good chance you'll get a letter (in about a year). If you would be due an additional refund, you've got to amend to get it.

 

[LOL!]

Although I've done a preliminary run of our taxes, we will not file until October. In the past we have gotten corrected 1099's as late as August.

If we are due a refund, we get it in January even without filing.

 

[GrayHare]

Those arcane K-1 forms ensure nothing gets filed from here until March.

 

[MichaelB]

I went ahead and posted this same question on the turbotax community. Here is the reply I got (similar to your reply) from one of their 'superusers'

"For a few dollars difference I wouldn't bother with the amended return. If it results in you owing money, you will get a letter in a few months saying "we think your filing needs to be adjusted like this "xxx" so we think you owe us this" $xx". So then you mark the "I agree" box and pay them."

I had thought about this approach too.

This sounds reasonable. It will also save TT filing fees. And if the amount is small enough, you might even get an IRS letter saying they calculated the liability but are writing it off because it is so low.

 

[braumeister]

Those arcane K-1 forms ensure nothing gets filed from here until March.

At the earliest!
I hated those things so much I resolved to never again own any LP stocks.

 

[frayne]

Filing an amended return is easy. You can do it in TurboTax, although I believe TT will not e-file it. But you can print it out and send it by snail mail; I did that in 2008 anyway.

Amended returns have to be mailed in anyways and the IRS won't even look at it until after April 15th.

I never file my taxes much before April due to the fact of getting corrected 1099s, which seems to happen with annual regularity these dyas.

 

[scrabbler1]

I complete my friend's tax forms and 2 years ago he received an amended 1099 form in March. The amended form included foreign tax paid so I had to switch from 1040A to 1040 which was a minor nuisance. At least he had not filed yet. How would that have been handled by an amended tax return if I had to switch to a different form to include the foreign tax paid, I shudder to think. (I am not asking the rest of you how to handle this, as he now has to use 1040 all the time.)

The only time I filed a tax return early, other than claiming a refund, was in the last 7 years of working (2001-2008) when I had to file a non-resident return. Because my home state's tax due was linked to the other state's tax due, I wanted to get this one filed and processed before I filed my home state's return. If there was a problem with the non-resident return, I did not want to have file two amended returns due to one problem.

 

[rbmrtn]

I never file my taxes much before April due to the fact of getting corrected 1099s, which seems to happen with annual regularity these dyas.

I never file until the due date 4/15, just wait to get all the corrected 1099s and K-1 forms. Also I have to write them check so no hurry. Haven't gotten a refund since part time college jobs.

 

[ronocnikral]

i just filed. I had almost $7k outstanding to me. My income is extremely volatile, my AGI is $100k less than last year and straddles a marginal tax rate. Either way, I'd rather get my money now when it is significant (at least to me), and deal with corrected 1099's before 4/15.

I guess I could just max out the W4 "exemptions" and all would be well.

 

[frayne]

i just filed. I had almost $7k outstanding to me. My income is extremely volatile, my AGI is $100k less than last year and straddles a marginal tax rate. Either way, I'd rather get my money now when it is significant (at least to me), and deal with corrected 1099's before 4/15.

I guess I could just max out the W4 "exemptions" and all would be well.

So you let uncle sam use $7k of your money interest free in 2012 ? Not a good thing in my book.

 

[jebmke]

I usually wait and file in September.

 

[ronocnikral]

So you let uncle sam use $7k of your money interest free in 2012 ? Not a good thing in my book.

While I understand that it may be easy for others to estimate their taxes, it has always been a very difficult thing for me. For example, my tax liability in 2011 was $35k and in 2012 was only $9k. While I knew my tax liability in 2012 would be lower, I didn't know exactly. And while $7k is a lot, I'd rather not pay the penalties, as that is not a good thing in my book.

Sometimes, it is much easier to look down your nose at people than to actually put into practice what you are advocating.