Filed taxes and forgot about 1099-R which was rolled over..

[trustee]

Because this 1099-R was rolled over and doesnt change the numbers at all in regards to taxable income, is an amended return still necessary?

Thanks guys! I don't know how this slipped my mind..

 

[easysurfer]

I did the very same thing the first year I FIRE'd.

That's why now I patiently wait a bit before any filing.

When I forgot the 1099-R, I did go ahead and do an amended return.

 

[ziggy29]

Because this 1099-R was rolled over and doesnt change the numbers at all in regards to taxable income, is an amended return still necessary?

Thanks guys! I don't know how this slipped my mind..

If it was a direct trustee to trustee rollover there should be no tax consequences for an amended return. So the short answer would be "perhaps not *necessary*", but at the same time there's a chance the IRS would see this as unreported income and claim back taxes are due. Now in your case, most likely you could say it was an honest omission that didn't impact your tax liability and with proper documentation it would *probably* go away as resolved.

It probably slipped your mind because it didn't affect your tax burden. Something similar happened to me in 2005 when I did a cashless exercise of Megacorp stock options. I sold something like $88K in stock with a taxable gain of $9K which was included on my W-2 and on which I already paid taxes. But because I forgot to include this transaction on Schedule D (even if the net gain was exactly $0 because the whole thing was already taxed so my tax basis and sale price were equal) they assumed the whole thing was taxable with a cost basis of $0 and sent me a $31,000 tax bill. Now in my case a quick phone call and explanation closed the matter, but it's still a stress you don't really need. (Especially since I got this letter on a Saturday and I had to stew on it until Monday morning).

In any event, filing an amended return might reduce the risk of the IRS questioning your return, but if you have the documentation to show it was a trustee-to-trustee rollover with no tax consequences it wouldn't likely result in any taxes or penalties owed if you didn't.

Me, I'd probably file the amended return just to be more bulletproof. I don't really want another one of those notices in the mail, though they are a natural cure for constipation....

 

[Turboslacker]

Don't know if not doing it will raise a red flag, but I had a similar situation a few years ago and found it no biggie to send in an amendment. Maybe a case of better safe than sorry. You might sleep better and not be worried about an IRS audit lol.

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[Alan]

I would definitely file an amended return. Small price to pay to ensure piece of mind.

One way a rollover would affect your taxes would be if you had done a ROTH conversion this tax year and you had a basis. If the rollover had come from a 401k or similar then it would affect the total of your IRAs on December 31st and so less of the basis would be converted so you would owe more taxes.

 

[trustee]

Thanks guys. I will file the amended return to play it safe.

With all the tax fraud going on, I was rushing to get my return filed quick. Guess I was a little toooo quick

 

[braumeister]

Really, I wouldn't worry about it.
I've made similar boneheaded mistakes in the past. If the IRS catches it, they will send you a letter (a postal audit) pointing out the problem and telling you that you owe some ungodly amount of money.

When that happens, all you have to do is reply to their letter, attaching a form or two and a supporting document or two. Within a few months, they will send you another letter saying "OK, never mind."

 

[ziggy29]

If the IRS catches it, they will send you a letter (a postal audit) pointing out the problem and telling you that you owe some ungodly amount of money.

When that happens, all you have to do is reply to their letter, attaching a form or two and a supporting document or two. Within a few months, they will send you another letter saying "OK, never mind."

See my experience above. Your mileage may vary, but I'd rather take a few minutes and a stamp or two and avoid the letter telling me I owe $31,000 to the U.S. Treasury.

You are almost certainly right that if something comes up, it will be resolved with no liability with the appropriate documentation. But that's not drama that I need personally.

 

[RunningBum]

I had a similar case as Ziggy where I just missed a stock sale for some reason, but for some reason we were in disagreement over the reported proceeds vs their records even after I filed an amended return to account for the transaction, which had a small gain. It took 3 letters and 2 calls and I still don't think they got it right but it was a small amount in my favor so I stopped arguing about it and figured they could bill me if they ever noticed. It was a pain in the butt though, so I definitely agree that filing an amended return is best.

 

[Turboslacker]

Of course I may been a bit more motivated to do an amended return right away since it meant more $ coming back to me.

Sent from my HTC One using Early Retirement Forum mobile app

 

[braumeister]

I guess I should qualify my comment with the fact that my bonehead errors made no difference in the amount of tax I owed. So the "Never mind" was literally just that.

 

[frayne]

If your 1099 R is coded G and there is no tax event, I wouldn't worry about it. But again, doing an amended return is no big deal either.

 

[Texas Proud]

I would do an amended return when you make sure that you are not getting any other changes.... I know of someone who got a notice from the IRS over a year later and they were taxing the whole thing...


As long as you have something reported to the IRS, you better make sure it is on the tax return... people do not check, but computers do and they cannot think....