Amended Return
A corrected tax return filed to fix errors on an original return.
An amended return (Form 1040-X for individuals) corrects errors or updates information on a previously filed tax return. Common reasons include discovering unreported income, missed deductions, or incorrect filing status. Amended returns can be filed within three years of the original filing date or two years of paying the tax, whichever is later.
Example
After filing, a freelancer realizes she forgot to deduct $4,000 in business mileage—she files Form 1040-X to claim the deduction and receive a $960 refund at her 24% rate.
Why It Matters for Your Business
If you discover an error that affects your tax liability, filing an amended return can recover overpaid taxes or correct underpayments before the IRS catches the discrepancy.
Related Terms
More Taxes Terms
Adjusted Gross Income
Gross income minus specific deductions like retirement contributions.
Tax Audit
An examination of tax returns by the IRS to verify accuracy.
Capital Gains
Profit from selling an asset for more than its purchase price.
Capital Loss
Loss from selling an asset for less than its purchase price.
Tax Deduction
An expense that reduces taxable income.
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