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Made a Mistake on Your Tax Return – What Happens Now?

Filing your tax return can be daunting, especially with the ever-changing tax code and complex paperwork. Tax return mistakes are surprisingly common, and even seasoned professionals can miss something. Making a mistake isn’t the end of the world, though. This article will guide you through the process of fixing tax return errors and help you avoid common family tax pitfalls so you can file with confidence.

Addressing Mistakes on Your Tax Return

  • Breathe easier – you have time. You generally have three years from the original filing date (or two years from paying the tax bill) to amend your return.
  • The IRS might catch it first. Don’t panic if you suspect an error. The IRS often identifies oversights like income omissions, math errors, or missing deductions, and will likely send you a letter outlining the issue and how to fix it.
  • Act quickly if you owe more. If the mistake results in owing more taxes, settle it promptly. Penalties and interest accrue on unpaid taxes, making it more expensive the longer you wait.
  • Missing out on benefits? File an amended return. Many mistakes involve overlooking deductions or credits, leading to overpaying taxes. An amended return (Form 1040-X) lets you claim these benefits retroactively.
  • Caught before the deadline? File a superseding return. If you discover the error before the filing deadline, you can file a “superseding return” to replace the original with the corrected version.

Common Family Tax Mistakes

  • Renting to relatives: Fair market rent avoids tax complications. Renting below market value could impact deductions and lead to gift tax issues.
  • Below-market loans: The IRS treats these as gifts or income depending on the interest rate. Understand the AFR rates and potential tax implications.
  • Gifting a home: Inheriting is generally better for tax purposes than receiving a property as a gift. Consider the step-up in basis on inherited assets.
  • De facto life estate: Transferring a home title while retaining residence creates a life estate and avoids gift tax, but the home’s value gets included in the estate.
  • Joint ownership: Adding a child’s name to the title can trigger gift tax and affect the home gain exclusion. Consult a tax professional before such transactions.
  • Incorrect withholding: Lack of communication between spouses can lead to under-withholding and a tax surprise. Coordinate your W-4s to avoid this issue.
  • Children and tax returns: Dependent children filing their own returns without checking the “someone can claim you” box can create discrepancies and require amending the child’s return.


Tax complexities can lead to unexpected errors, but knowledge is power. Remember, you have time to fix mistakes, and avoiding common family tax pitfalls can save you future headaches. When in doubt, don’t hesitate to reach out to us! We have a team of experienced tax professionals ready to provide personalized guidance and ensure a smooth tax season.

JS Morlu LLC is a top-tier accounting firm based in Woodbridge, Virginia, with a team of highly experienced and qualified CPAs and business advisors. We are dedicated to providing comprehensive accounting, tax, and business advisory services to clients throughout the Washington, D.C. Metro Area and the surrounding regions. With over a decade of experience, we have cultivated a deep understanding of our clients’ needs and aspirations. We recognize that our clients seek more than just value-added accounting services; they seek a trusted partner who can guide them towards achieving their business goals and personal financial well-being.
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