Tax Tips: Amending tax returns

If you find an error or an item omitted from a prior year's tax return, you can file an amended tax return for up to three years after the original filing due date. If omitted an item that causes you to owe more taxes, you should definitely do this before the IRS catches up with you. The longer you go without paying, the more you will owe in interest and penalties once you finally do file and pay.

But if you've forgotten items that would have lowered your taxes, you have to weigh the options before you file. Sometimes the amount the IRS would refund to you will be much smaller than the fee to have a tax preparer do the amended return, in which case it doesn't make sense to file. Let the IRS keep your money and save the tax preparer fee.

It might also make sense to not file if the additional item you want to deduct is something that might cause you to be audited or otherwise examined. If you've been honest in filing your taxes and you have all relevant documentation, you should pass the audit with flying colors. However, some taxpayers don't even want to have to deal with the hassle or are worried that they may just be calling more attention to their tax returns.... In which case they might not file the amended return to take the additional deduction.

Tracy L. Coenen, CPA, MBA, CFE performs fraud examinations and financial investigations for her company Sequence Inc. Forensic Accounting, and is the author of Essentials of Corporate Fraud.

Tax Tips for Real Estate Agents and Brokers

Most real estate agents and brokers receive income in the form of commissions from sales transactions. You're generally not considered an employee under federal tax guidelines, but rather a self-employed sole proprietor, even if you're an agent or broker working for a real estate brokerage firm. This self-employed status allows you to deduct many of the expenses you incur in your real estate sales or property management activities. Careful record keeping and knowing your eligible write-offs are key to getting all of the tax deductions you're entitled to.

Read More

Brought to you by

What is the Educator Expense Tax Deduction?

The Educator Expense Tax Deduction allows teachers and certain academic administrators to deduct a portion of the costs of technology, supplies, and certain training. Here’s what teachers need to know about taking the Educator Expense Deduction on their tax returns.

Read More

Brought to you by

Self-Employed Less Than a Year? How to Do Your Taxes

Have you been self-employed less than a year? If you’re just starting out, it’s possible you worked at a job earlier in the tax year before making the switch to self-employment, or you’re working multiple jobs. In this case, you may have more than once source of income you’ll need to report on your income tax return.

Read More

Brought to you by

Taxes for Grads: Do Scholarships Count as Taxable Income?

Heading off to college to broaden your horizons is exciting, but funding your education via scholarships? That's even better. Scholarships often provide a path to education that might not be feasible otherwise, which is why the Internal Revenue Service (IRS) can be generous in minimizing students' tax obligations. But sometimes scholarship money does count as income, and it’s better to find out now if your scholarship adds to your tax liability than to have a surprise later. Here’s how to decode your scholarship taxation.

Read More

Brought to you by
Read Full Story
Your resource on tax filing
Tax season is here! Check out the Tax Center on AOL Finance for all the tips and tools you need to maximize your return.

Want more news like this?

Sign up for Finance Report by AOL and get everything from business news to personal finance tips delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.