Filing an Amended Tax Return: Obnoxious!
There’s only one activity I enjoy more than the slow, tooth-pulling agony of preparing my taxes: Preparing my taxes twice.
Lucky me! I just found out that I need to file an amended tax return for 2007, a realization that comes shortly on the heels of receiving a huge refund. I want off this emotional rollercoaster!
Why amend? I went back to school in September, so I took the Lifetime Learning Credit, on the advice of my tax prep software. However, yesterday I discovered that the school I’m attending doesn’t participate in federal student aid programs, even though it’s accredited and well-established.
In short: No FAFSA, and no Form 1098-T from the school. I can’t claim a cent in tuition tax credits. This means I will have to pay back a large portion of my refund. ARGH.
If you find yourself in my predicament, there is a surprising amount of help on the web. About.com has a good guide for filing an amendment, including how to report the changes in detail.
If it’s possible you might not need to amend in the first place, consider the hassle required. Paula wrote a post last year that argued for skipping the amended return unless it was absolutely necessary. In my case, unfortunately, I think it’s necessary, unless I want the IRS to come after me, demanding payment with interest.
Have any of you ever needed to file an amended return? Is the process as torturous as I’m dreading?
Jan: I’m sorry to hear this. I know you were counting on the money this year. I’m curious how you found out you needed to amend your return. I took a look at the link to the IRS website and this is how they handle the question:
So I did a quick search on the IRS site about the requirements for the Hope Scholarship Credit and it appears the details are buried in PDF files. You’d have to know where and how to find this information. One more reason why I’ve never prepared my return by myself.
I learned last year from Allison that most tax preparation firms offer review services for those who do decide to self-prepare:
Allison’s business, Dollars and Sense Taxes and Accounting, offers this service as well and the fee is only $60 for Queercents readers. She can be contacted through her website or allison [at] queercents [dot] com if anyone wants her to check their work before sending in their return this year.
I’ve had to file an amended tax return once before but it was no big deal since my accountant filled everything out and all I had to do was sign the forms and mail it out. One friend once told me he pays professionals to handle his taxes since he figures it’s cheaper than having to pay for therapy later.
Ohh, sorry to hear about that . I’ve never had to file an amended return, but I periodically have to skip business deductions because Axis II/Subservient records is a sole proprietorship. Sooo, I’m only allowed a certain number of years every seven that I can claim a loss, otherwise hobby law kicks in and I retroactively lose ALL deductions.
Sadly, this year is one of those, and it truly sucks given my current circumstances.
You’ll get through it. Let me know if there’s anything I can do.
Nina – I found out because I was discussing taxes with a colleague at massage school, and she pointed out that the school didn’t participate in federal funding programs. So then I asked an administrator at the school, and it turns out my colleague was correct. VERY frustrating.
I will be getting in touch with Alison next year, thanks for the info!
FitFool – now that I’m running my own business (soon to be running two, when I graduate from massage school) I will definitely be hiring an accountant. Any tips on finding a good one?
Christopher – what’s “hobby law?”