Treasury and IRS Announce

Special Relief to Encourage

Leave Donation Programs for

Victims of Hurricane Sandy

IR-2012-88, Nov. 6, 2012

WASHINGTON — As part of the

administration’s efforts to bring

all available resources to bear

to support state and local partners

impacted by Hurricane Sandy,

the Treasury Department and the

Internal Revenue Service today

announced special relief intended

to support leave-based donation

programs to aid victims who have

suffered from the extraordinary

destruction caused by Hurricane Sandy.

Under these programs, employees may

donate their vacation, sick or personal

leave in exchange for employer cash

payments made to qualified tax-exempt

organizations providing relief for the

victims of Hurricane Sandy.

Employees can forgo leave in

exchange for employer cash payments

made before Jan. 1, 2014.

Under this special relief,

the donated leave will not be

included in the income or wages

of the employees. Employers will

be permitted to deduct the amount

of the cash payment. Details on

this relief are in Notice 2012-69.

The IRS continues to monitor the

situation and will provide additional

relief related to Hurricane Sandy as needed.

Related Item: Help for Victims of Hurricane Sandy


 Did you receive a letter or notice from the IRS?

Each year, the Internal Revenue Service sends millions of letters and notices to taxpayers for a variety of reasons, but that doesn’t mean you need to worry. Here are eight things you should know about IRS notices — just in case one shows up in your mailbox.

1. Don’t panic. Many of these letters and notices can be dealt with simply and painlessly.
2. There are a number of reasons the IRS sends notices to taxpayers. The notice may request payment of taxes, notify you of a change to your account or request additional information. The notice you receive normally covers a very specific issue about your account or tax return.
3. Each letter and notice offers specific instructions on what you need to do to satisfy the inquiry.
4. If you receive a correction notice, you should review the correspondence and compare it with the information on your return.
5. If you agree with the correction to your account, usually no reply is necessary unless a payment is due.
6. If you do not agree with the correction the IRS made, it is important that you respond as requested. Write to explain why you disagree. Include any documents and information you wish the IRS to consider, along with the bottom tear-off portion of the notice. Mail the information to the IRS address shown in the lower left part of the notice. Allow at least 30 days for a response.
7. Most correspondence can be handled without calling or visiting an IRS office. However, if you have questions, call the telephone number in the upper right corner of the notice. Have a copy of your tax return and the correspondence available when you call.
8. It’s important that you keep copies of any correspondence with your records.
For more information about IRS notices and bills, see Publication 594, The IRS Collection Process. Information about penalties and interest is available in

The IRS announced it plans to open the 2013 filing season and begin processing individual income tax returns on January 30.

There are several forms affected by the late legislation that require more extensive programming. The IRS hopes to begin accepting tax returns including these tax forms between late February and into March. The key forms that require more extensive programming changes include Form 5695 (Residential Energy Credits), Form 4562 (Depreciation and Amortization) and Form 3800 (General Business Credit). A full listing of the forms that won’t be accepted until later is available on


I see signs going up all over including a bill board stating amounts you can get for refunds, worse yet, same day or next day refunds.

Be aware people, IRS first off isn't accepting electronic returns until January 30th.   Second, IRS does NOT issue same day or next day refund checks. I mean really ... think about it, when did government react that fast to sending refunds.

So beware of Tax Preparers who are telling you they can get you HUGE refunds within 24 hours. It just is not happening.


IRS Extends Hurricane Sandy Diesel Fuel Penalty Waiver to Dec. 7 for New Jersey and Parts of New York

WASHINGTON — As part of the administration’s efforts to bring all available resources to bear to support state and local partners impacted by Hurricane Sandy, the Internal Revenue Service today extended until Dec. 7 the diesel fuel penalty waiver, due to expire today, for New Jersey and parts of New York.

The extension is based on an extended fuel waiver granted to these areas by the Environmental Protection Agency (EPA). The original waiver was put in place in response to shortages of clear diesel fuel caused by the hurricane.

As a result, the IRS will not impose a tax penalty when dyed diesel fuel is sold for use or used on the highway. This relief applies beginning Oct. 30, 2012 to the entire state of New Jersey and to the five boroughs of New York City and Nassau, Suffolk, Rockland and Westchester counties in New York State, and will remain in effect through Dec. 7, 2012.

This relief is available to any person that sells or uses dyed fuel for highway use. In the case of the operator of the vehicle in which the dyed fuel is used, the relief is available only if the operator or the person selling the fuel pays the 24.4-cent-per-gallon tax that normally applies to diesel fuel for on-road use. The IRS will not impose penalties for failure to make semimonthly deposits of this tax. IRS Publication 510, Excise Taxes, has information on the proper method for reporting and paying the tax.

Ordinarily, dyed diesel fuel is not taxed, because it is sold for uses exempt from excise tax, such as to farmers for farming purposes, for home heating use and to local governments for buses.

Finally, the IRS will not impose the tax penalty on a failure to meet the requirements of EPA highway diesel fuel sulfur content regulations if EPA has waived those requirements.

The IRS is closely monitoring the situation and will provide additional relief as needed.



Issue Number:    IR-2012-93

Retirement Plans Can Make Loans, Hardship Distributions to Sandy Victims

WASHINGTON — As part of the administration’s efforts to bring all available resources to bear to support state and local partners impacted by Hurricane Sandy, the Internal Revenue Service today announced that 401(k)s and similar employer-sponsored retirement plans can make loans and hardship distributions to victims of Hurricane Sandy and members of their families.

401(k) plan participants, employees of public schools and tax-exempt organizations with 403(b) tax-sheltered annuities, and state and local government employees with 457(b) deferred-compensation plans may be eligible to take advantage of these streamlined loan procedures and liberalized hardship distribution rules. Though IRA participants are barred from taking out loans, they may be eligible to receive distributions under liberalized procedures.

Retirement plans can provide this relief to employees and certain members of their families who live or work in the disaster area. To qualify for this relief, hardship withdrawals must be made by Feb. 1, 2013.

The IRS is also relaxing procedural and administrative rules that normally apply to retirement plan loans and hardship distributions. As a result, eligible retirement plan participants will be able to access their money more quickly with a minimum of red tape. In addition, the six-month ban on 401(k) and 403(b) contributions that normally affects employees who take hardship distributions will not apply.

This broad-based relief means that a retirement plan can allow a Sandy victim to take a hardship distribution or borrow up to the specified statutory limits from the victim’s retirement plan. It also means that a person who lives outside the disaster area can take out a retirement plan loan or hardship distribution and use it to assist a son, daughter, parent, grandparent or other dependent who lived or worked in the disaster area.

Plans will be allowed to make loans or hardship distributions before the plan is formally amended to provide for such features. In addition, the plan can ignore the limits that normally apply to hardship distributions, thus allowing them, for example, to be used for food and shelter. If a plan requires certain documentation before a distribution is made, the plan can relax this requirement as described in the Announcement.

Ordinarily, retirement plan loan proceeds are tax-free if they are repaid over a period of five years or less.  Under current law, hardship distributions are generally taxable. Also,  a 10 percent early-withdrawal tax usually applies.

Further details are in Announcement 2012-44, posted today on


IRS Warns Consumers of Possible Scams Relating to Hurricane Sandy Relief

IR-2012-91, Nov. 9, 2012

WASHINGTON — The Internal Revenue Service today issued a consumer alert about possible scams taking place in the wake of Hurricane Sandy.

Following major disasters, it’s common for scam artists to impersonate charities to get money or private information from well-intentioned taxpayers. Such fraudulent schemes may involve contact by telephone, social media, email or in-person solicitations.

The IRS cautions both hurricane victims and people wishing to make disaster-related charitable donations to avoid scam artists by following these tips:

  • To help disaster victims, donate to recognized charities. 
  • Be wary of charities with names that are similar to familiar or nationally known organizations. Some phony charities use names or websites that sound or look like those of respected, legitimate organizations. The IRS website at has a search feature, Exempt Organizations Select Check, which allows people to find legitimate, qualified charities to which donations may be tax-deductible. Legitimate charities may also be found on the Federal Emergency Management Agency (FEMA) Web site at
  • Don’t give out personal financial information — such as Social Security numbers or credit card and bank account numbers and passwords — to anyone who solicits a contribution from you. Scam artists may use this information to steal your identity and money.
  • Don’t give or send cash. For security and tax record purposes, contribute by check or credit card or another way that provides documentation of the gift.
  • Call the IRS toll-free disaster assistance telephone number, 1-866-562-5227, if you are a hurricane victim with specific questions about tax relief or disaster related tax issues.

Scam artists can use a variety of tactics. Some scammers operating bogus charities may contact people by telephone to solicit money or financial information. They may even directly contact disaster victims and claim to be working for or on behalf of the IRS to help the victims file casualty loss claims and get tax refunds. They may attempt to get personal financial information or Social Security numbers that can be used to steal the victims’ identities or financial resources.

Bogus websites may solicit funds for disaster victims. Such fraudulent sites frequently mimic the sites of, or use names similar to, legitimate charities, or claim to be affiliated with legitimate charities, in order to persuade members of the public to send money or provide personal financial information that can be used to steal identities or financial resources.   Additionally, scammers often send e-mail that steers the recipient to bogus websites that sound as though they are affiliated with legitimate charitable causes.

Taxpayers suspecting disaster-related frauds should visit and search for the keywords “Report Phishing.”

More information about tax scams and schemes may be found at using the keywords “scams and schemes.”


IRS Provides Tax Relief to Victims of Hurricane Isaac;
Return filing and Tax Payment Deadline Extended to Jan. 11, 2013


WASHINGTON –– The Internal Revenue Service is providing tax relief to individuals and businesses affected by Hurricane Isaac.

Following recent disaster declarations for individual assistance issued by the Federal Emergency Management Agency, the IRS announced today that affected taxpayers in Louisiana and Mississippi will receive tax relief, and other locations may be added in coming days based on additional damage assessments by FEMA.

The tax relief postpones various tax filing and payment deadlines that occurred on or after Aug. 26. As a result, affected individuals and businesses will have until Jan. 11, 2013 to file these returns and pay any taxes due. This includes corporations and businesses that previously obtained an extension until Sept. 17, 2012, to file their 2011 returns and individuals and businesses that received a similar extension until Oct. 15. It also includes the estimated tax payment for the third quarter of 2012, normally due Sept. 17.

The IRS will abate any interest, late-payment or late-filing penalty that would otherwise apply. In addition, the IRS is waiving failure-to-deposit penalties for federal employment and excise tax deposits normally due on or after Aug. 26 and before Sept. 10, if the deposits are made by Sept. 10, 2012. Details on available relief, including information on how to claim a disaster loss by amending a prior-year tax return, can be found on the disaster relief page on

The tax relief is part of a coordinated federal response to the damage caused by the hurricane and is based on local damage assessments by FEMA. For information on disaster recovery, individuals should visit

So far, IRS filing and payment relief applies to the following localities:

  • In Louisiana: Ascension, Jefferson, Lafourche, Livingston, Orleans, Plaquemines, St. Bernard, St. Charles, St. John the Baptist and St. Tammany parishes;
  • In Mississippi: Hancock, Harrison, Jackson and Pearl counties.

 IRS Summertime Tax Tip 2012-19


Tax Tips for Recently Married Taxpayers

If you’ve recently updated your status from single to married, you’re not alone – late spring and summertime is a popular period for weddings. Marriage also brings about some changes with your taxes. Here are several tips for newlyweds from the IRS.

  • Notify the Social Security Administration  It’s important that your name and Social Security number match on your next tax return, so if you’ve taken on a new name, report the change to the Social Security Administration. File Form SS-5, Application for a Social Security Card. The form is available on SSA’s website at, by calling 800-772-1213, or visiting a local SSA office.
  • Notify the IRS if you move  IRS Form 8822, Change of Address, is the official way to update the IRS of your address change. Download Form 8822 from or order it by calling 800-TAX-FORM
  • Notify the U.S. Postal Service  To ensure your mail – including mail from the IRS – is forwarded to your new address, you’ll need to notify the U.S. Postal Service. Submit a forwarding request online at or visit your local post office.
  • Notify your employer  Report your name and/or address change to your employer(s) to make sure you receive your Form W-2, Wage and Tax Statement, after the end of the year.
  • Check your withholding  If you both work, keep in mind that you and your spouse’s combined income may move you into a higher tax bracket. You can use Publication 505, Tax Withholding and Estimated Tax, to help determine the correct amount of withholding for your marital status, and it will also help you complete a new Form W-4, Employee's Withholding Allowance Certificate. Fill out and print Form W-4 online and give it to your employer(s) so the correct amount will be withheld from your pay.
  • Select the right tax form  Choose your individual income tax form wisely because it can help save you money. Newlywed taxpayers may find that they now have enough deductions to itemize on their tax returns rather than taking the standard deduction. Itemized deductions must be claimed on a Form 1040, not a 1040A or 1040EZ.
  • Choose the best filing status  A person’s marital status on Dec. 31 determines whether the person is considered married for that year for tax purposes. Tax law generally allows married couples to choose to file their federal income tax return either jointly or separately in any given year. Figuring the tax both ways can determine which filing status will result in the lowest tax, but filing jointly is usually more beneficial.

Bottom line: planning for your wedding may be over, but don’t forget about planning for the tax-related changes that marriage brings. More information about changing your name, address and income tax withholding is available on IRS forms and publications can be obtained from or by calling 800-TAX-FORM (800-829-3676).

To automatically receive IRS tax tips, visit, click on "News" and select "e-News Subscriptions."


  • Form 8822, Change of Address (PDF)
  • Form W-4, Employee's Withholding Allowance Certificate (PDF)
  • Publication 505, Tax Withholding and Estimated Tax (PDF)

 IRS Summertime Tax Tip 2012-18




Taxpayers should keep copies of their tax returns, but if they cannot be located or have been destroyed during natural disasters or by fire, the IRS can help. Whether you need your prior year’s tax return to apply for a loan or for legal reasons, you can obtain copies or transcripts from the IRS.

Here are 10 things to know if you need federal tax return information from a previously filed tax return.

1. Get copies of your federal tax return via the web, phone or by mail.

2. Transcripts are free and are available for the current and past three tax years.

3. A tax return transcript shows most line items from your tax return as it was originally filed, including any accompanying forms and schedules. It does not reflect any changes made after the return was filed.

4. A tax account transcript shows any later adjustments either you or the IRS made after you filed your tax return. This transcript shows basic data including marital status, type of return filed, adjusted gross income and taxable income.

5. To request either type of transcript online, go to and use the online tool called Order A Transcript. To order by phone, call 800-908-9946 and follow the prompts in the recorded message.

6. To request a 1040, 1040A or 1040EZ tax return transcript through the mail, complete IRS Form 4506T-EZ, Short Form Request for Individual Tax Return Transcript. Businesses, partnerships and individuals who need transcript information from other forms or need a tax account transcript must use Form 4506-T, Request for Transcript of Tax Return.

7. If you order online or by phone, you should receive your tax return transcript within five to 10 days from the time the IRS receives your request. Allow 30 calendar days for delivery of a tax account transcript if you order by mail.

8. If you need an actual copy of a previously filed and processed tax return, it will cost $57 for each tax year you order. Complete Form 4506, Request for Copy of Tax Return, and mail it to the IRS address listed on the form for your area.  Copies are generally available for the current year and past six years. Please allow 60 days for delivery. 

9. The fee for copies of tax returns may be waived if you are in an area that is declared a federal disaster by the President. Visit, keyword “disaster,” for more guidance on disaster relief.

10. Forms 4506, 4506-T and 4506T-EZ are available at or by calling 800-TAX-FORM (800-829-3676).




Recession claimed 170,000 small businesses in two years

Date: Tuesday, July 24, 2012, 1:00am EDT
In 2008, there were 6.96 million small businesses. In the latest government count, there were 6.79 million small businesses.

In 2008, there were 6.96 million small businesses. In the latest government count, there were 6.79 million small businesses.


The nation lost more than 170,000 small businesses during the first two years of the recession, according to an On Numbers analysis of newly released federal data.

A total of 6.79 million small businesses operated within the nation's 938 metropolitan and micropolitan areas in 2010, the latest year for which official statistics are available.

That figure was down from 6.82 million small businesses in 2009 and 6.96 million in 2008. The recession officially began in December 2007.

On Numbers defines a small business as any private-sector enterprise with fewer than 100 employees. Totals for the 938 markets were calculated from raw data collected by the U.S. Census Bureau.

The downward trend was widespread. Seventy-five of the nation's 100 biggest markets had fewer small businesses in 2010 than the year before, with Reno, Nevada, suffering the sharpest decline, 2.6 percent.

The largest drop anywhere (regardless of market size) was 7.4 percent in the Kirksville, Mo., micropolitan area.

Breakdowns for all metros and micros can be found in the following database, which provides small business counts for 2009 and 2010. Use the tab to isolate a specific state, or click Search to view the entire list. If you wish to re-sort the database, click the appropriate column header.

A similar comparison of small business counts for the 2008-2009 period can be accessed by clicking here.


Tax Relief for Victims of Tropical Storm Debby in Florida


Updated 7/13/2012 to include Hillsborough, Manatee and Taylor counties.

FL-2012-07, Jul. 5, 2012

PLANTATION — Victims of tropical storm Debby that began on June 23, 2012 in parts of Florida may qualify for tax relief from the Internal Revenue Service.

TThe President has declared Baker, Bradford, Clay, Columbia, Duval, Franklin, Hernando, Highlands, Hillsborough, Manatee, Nassau, Pasco, Pinellas Suwannee, Taylor, Union and Wakulla counties a federal disaster area. Individuals who reside or have a business in these counties may qualify for tax relief.

The declaration permits the IRS to postpone certain deadlines for taxpayers who reside or have a business in the disaster area. For instance, certain deadlines falling on or after June 23, and on or before Aug. 22, have been postponed to Aug. 22, 2012.

In addition, the IRS is waiving the failure-to-deposit penalties for employment and excise tax deposits due on or after June 23, and on or before July 9, as long as the deposits are made by July 9, 2012.

If an affected taxpayer receives a penalty notice from the IRS, the taxpayer should call the telephone number on the notice to have the IRS abate any interest and any late filing or late payment penalties that would otherwise apply. Penalties or interest will be abated only for taxpayers who have an original or extended filing, payment or deposit due date, including an extended filing or payment due date, that falls within the postponement period.

The IRS automatically identifies taxpayers located in the covered disaster area and applies automatic filing and payment relief. But affected taxpayers who reside or have a business located outside the covered disaster area must call the IRS disaster hotline at 1-866-562-5227 to request this tax relief.

Covered Disaster Area

The counties listed above constitute a covered disaster area for purposes of Treas. Reg. § 301.7508A-1(d)(2) and are entitled to the relief detailed below.

Affected Taxpayers

Taxpayers considered to be affected taxpayers eligible for the postponement of time to file returns, pay taxes and perform other time-sensitive acts are those taxpayers listed in Treas. Reg. § 301.7508A-1(d)(1), and include individuals who live, and businesses whose principal place of business is located, in the covered disaster area. Taxpayers not in the covered disaster area, but whose records necessary to meet a deadline listed in Treas. Reg. § 301.7508A-1(c) are in the covered disaster area, are also entitled to relief. In addition, all relief workers affiliated with a recognized government or philanthropic organization assisting in the relief activities in the covered disaster area and any individual visiting the covered disaster area who was killed or injured as a result of the disaster are entitled to relief.

Grant of Relief

Under section 7508A, the IRS gives affected taxpayers until Aug. 22 to file most tax returns (including individual, corporate, and estate and trust income tax returns; partnership returns, S corporation returns, and trust returns; estate, gift, and generation-skipping transfer tax returns; and employment and certain excise tax returns), or to make tax payments, including estimated tax payments, that have either an original or extended due date occurring on or after June 23 and on or before Aug. 22.

The IRS also gives affected taxpayers until Aug. 22 to perform other time-sensitive actions described in Treas. Reg. § 301.7508A-1(c)(1) and Rev. Proc. 2007-56, 2007-34 I.R.B. 388 (Aug. 20, 2007), that are due to be performed on or after June 23 and on or before Aug. 22.

This relief also includes the filing of Form 5500 series returns, in the manner described in section 8 of Rev. Proc. 2007-56. The relief described in section 17 of Rev. Proc. 2007-56, pertaining to like-kind exchanges of property, also applies to certain taxpayers who are not otherwise affected taxpayers and may include acts required to be performed before or after the period above.

The postponement of time to file and pay does not apply to information returns in the W-2, 1098, 1099 series, or to Forms 1042-S or 8027. Penalties for failure to timely file information returns can be waived under existing procedures for reasonable cause. Likewise, the postponement does not apply to employment and excise tax deposits. The IRS, however, will abate penalties for failure to make timely employment and excise tax deposits due on or after June 23 and on or before July 9 provided the taxpayer makes these deposits by July 9.

Casualty Losses

Affected taxpayers in a federally declared disaster area have the option of claiming disaster-related casualty losses on their federal income tax return for either this year or last year. Claiming the loss on an original or amended return for last year will get the taxpayer an earlier refund, but waiting to claim the loss on this year's return could result in a greater tax saving, depending on other income factors.

Individuals may deduct personal property losses that are not covered by insurance or other reimbursements. For details, see Form 4684 and its instructions.

Affected taxpayers claiming the disaster loss on last year's return should put the Disaster Designation "Florida/Tropical Storm Debby" at the top of the form so that the IRS can expedite the processing of the refund.

Other Relief

The IRS will waive the usual fees and expedite requests for copies of previously filed tax returns for affected taxpayers. Taxpayers should put the assigned Disaster Designation in red ink at the top of Form 4506, Request for Copy of Tax Return, or Form 4506-T, Request for Transcript of Tax Return, as appropriate, and submit it to the IRS.

Affected taxpayers who are contacted by the IRS on a collection or examination matter should explain how the disaster impacts them so that the IRS can provide appropriate consideration to their case.

Taxpayers may download forms and publications from the official IRS website,, or order them by calling 1-800-TAX-FORM (1-800-829-3676). The IRS toll-free number for general tax questions is 1-800-829-1040.

Related Information

Disaster Assistance and Emergency Relief for Individuals and Businesses
Recent IRS Disaster Relief Announcements


Individual Health Insurance Premium Tax Credit
2010 Health Care Act

Health Care ActOne element of the 2010 Health Care Act signed into law by President Obama in March 2010 is an individual tax credit for many Americans to help them buy health insurance. Since the law was upheld by the Supreme Court on June 28, 2012, many of our clients are just hearing about this credit and want more information.
The credit is based on a sliding scale and decreases as income increases. Individuals who are already on Medicaid, Medicare, Tri-Care and other government plans will not qualify for the tax credit. If an individual‘s income is under 400% of the Federal Poverty Level (FPL) for their family size they may qualify for the credit, but if income is over that amount they will not receive a credit.

We discussed the credit in our “Tax Issues of the Health Care Act” which is available as an on demand webcast.  Our discussion below is just one small piece of the webcast.
Calculating the Credit

  1. Start with AGI, then add in foreign income, tax exempt interest and excluded social security to determine family income (also include any dependent income reported on their own return),

  2. Then determine the income percentage of FPL (Table 2 Below),
  3. Then determine the number of personal exemptions as taken on the return,
  4. Then identify “silver” level premiums for residency zip code (Not yet available from IRS), (4 levels of coverage-bronze, silver, gold, platinum)
  5. Then go to the sliding-scale table to determine maximum premiums required for taxpayer (Table 3 Below),
  6. The credit equals (silver premiums-maximum out of pocket annual premiums). If taxpayer chooses a higher level of coverage, they get no additional credit, if lesser coverage, they still get the full credit.

Table 2                                                       
Table 3

Example 1 Individual Credit

Example 2

Example 3 - Individual Credit

Copyright ©July 2012, NSRTP Tax Pro, All rights reserved.


Posted 7/19/2012

IRS Offers Tips on How to Fix Errors Made on Your Tax Return

If you discover an error after you file your tax return, you can correct it by amending your return. Here are 10 tips from the Internal Revenue Service about amending your federal tax return:

  1. When to amend a return Generally, you should file an amended return if your filing status, number of dependents, total income, tax deductions or tax credits were reported incorrectly or omitted. Additional reasons for amending a return are listed in the instructions.
  2. When NOT to amend a return In some cases, you do not need to amend your tax return. The IRS usually corrects math errors or requests missing forms - such as Forms W-2 or schedules - when processing an original return. In these instances, do not amend your return.
  3. Form to use Use Form 1040X, Amended U.S. Individual Income Tax Return, to amend a previously filed Form 1040, 1040A, 1040EZ, 1040NR or 1040NR-EZ. Make sure you check the box for the year of the return you are amending on the Form 1040X. An amended tax return cannot be filed electronically.
  4. Multiple amended returns If you are amending more than one year's tax return, prepare a separate 1040X for each return and mail them in separate envelopes to the appropriate IRS processing center (see "Where to File" in the instructions for Form 1040X).
  5. Form 1040X The Form 1040X has three columns. Column A shows original figures from the original return. Column B shown the changes you are making. Column C shows the corrected figures. There is an area on the back of the form to explain the specific changes and the reasons for the changes.
  6. Other forms or schedules If the changes involve other schedules or forms, attach them to the Form 1040X. Failure to do this will cause a delay in processing.
  7. Additional refund If you are amending your return to get an additional refund, wait until you have received your original refund before filing Form 1040X. You may cash that check while waiting for any additional refund.
  8. Additional tax If you owe additional tax, you should file Form 1040X and pay the tax as soon as possible to limit interest and penalty charges.
  9. When to file Generally, to claim a refund, you must file Form 1040X within three years from the date you filed your original tax return or within two years from the date you paid the tax, whichever is later.
  10. Processing time Normal processing time for amended returns is 8 to 12 weeks.


  • Form 1040X, Amended Federal Income Tax Return (PDF 117K)
  • Instructions for Form 1040X (PDF 45K)

YouTube Videos:
Amending My Return - English Spanish ASL


March 27, 2012 9:17 AM, © 2012 CBS Interactive Inc.

5 things that trigger an IRS audit


Ray Martin

 No one wants to get that IRS Notice or Letter of additional taxes due or an invitation to come to the local IRS office for an audit. If you want to reduce your chances of getting flagged for an audit, or to know that your chances for one are higher,  then you need to know what can trigger it. Here are five situations that can draw additional attention of the IRS to your tax return.


-- Reporting income and taxes withheld on your tax return that does not agree with the information on the Forms W-2 and 1099 that you received. The IRS receives the same information and their Document Matching Program will always flag these errors.

-- Total income from self employment, reported on Schedule C, of $100,000 or more. According to one study, the IRS has concluded that individuals filing Schedule C are more likely to under-report their income and overstate their deductions.

-- Claiming deductions that are unusually large in relation to your income. According to a report of IRS inquiries, the IRS selected a taxpayer's return for audit when the tax payer claimed over $18,000 of un-reimbursed business expenses when he reported only $25,000 in gross income.

-- Married taxpayers filing separately who both claim the same deductions. Many such taxpayers should split or allocate the deductions that are paid jointly.

-- Taxpayers who earn their income from certain industries or activities that, based on past IRS audit experience, have a higher incidence of noncompliance. This includes tax returns of auto dealers, taxi and air service operators, attorneys, gas retailers, etc.


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