What’s an amended tax form, and do I need to file one for 2020? What to know

Tax season has been complicated this year, to say the least. Not only were people filing for missing stimulus money on their 2020 tax return as a Recovery Rebate Credit — even those who don’t usually have to file taxes — a third stimulus check started going out in the midst of this, too. Plus, the March stimulus package includes a number of new tax breaks and credits tied to your taxes, making things extra confusing for people who had already filed their return this year. And then the tax deadline got moved from April 15 to May 17. 

All of the changes have brought up the topic of the amended tax form — a form you can file with the IRS if you discover an error after filing your return. The IRS has cautioned against using this form, however, for changes such as the additional child tax credit funds and unemployment tax breaks. 

So how do you know if you need to file an amended tax form to make sure you’re getting the full amount of money you’re owed this year? We’ll break it down for you here. 

What is an amended tax form, and when would you need to file one?

An amended tax form — formally called Form 1040-X, Amended US Individual Income Tax Return — is used to correct tax forms 1040, 1040-A, 1040-EZ, 1040-NR or 1040-NR EZ. You would file an amended return to correct any errors in your return. 

For example, if there’s a change in your filing status, income, deductions, credits or tax liability, you might want to file an amended form. 

If you owe the IRS additional taxes and the due date for filing the return has not passed — in this case, you realize the error before May 17 — you can avoid paying the IRS penalties and interest if you file Form 1040-X and pay the extra amount for 2020. An example could be if you forgot to claim income (like from Form W-2 or 1099), or you got a corrected information statement with different income or withholding amounts. 

Do I need to file an amended tax form to get the full amount I’m owed for the 2021 child tax credit, unemployment tax breaks and other benefits? 

When it comes to all of the new provisions in the new stimulus package — including the expanded child tax credit, earned income tax credit and unemployment tax breaks — taxpayers should not file an amended return. 

“The IRS strongly urges taxpayers to not file amended returns related to the new legislative provisions or take other unnecessary steps at this time,” the IRS said March 12. 

The IRS has begun making 2 million “plus-up” payments to people who need an adjustment to their third stimulus check total, as a result of changes in their 2020 taxes, the agency announced April 2.

The IRS will provide additional information on the provisions that could affect your 2020 return, including the retroactive provision that makes the first $10,200 of 2020 unemployment benefits nontaxable. For those who haven’t filed yet, the IRS will provide a worksheet for paper filers, and work with tax software companies so taxpayers can determine how to report their unemployment income on their return. Those who received unemployment benefits last year and already filed their 2020 return should not file an amended return unless the IRS issues additional guidance later. 

Payments should be automatic for those who file their 2020 tax returns by May 17, the new tax deadline. 

Timing-wise, when would I need to file an amended tax form? 

Generally, to claim a refund, you have to file Form 1040-X within three years after the date you filed your original return, or within two years of the date you paid the tax — whichever is later, according to the IRS. There are special rules, however, for refund claims related to net operating losses, foreign tax credits, bad debts and other issues. 

How do you file an amended tax form, if needed? 

You can submit Form 1040-X electronically using most tax software options on the market. Or you can submit a paper version. Find a full list of instructions from the IRS here. And note that if you make a change to your federal tax return, you may also need to change your state return, too. 

Is it free to file an amended tax form? 

It depends. Some tax preparation software will let you amend your return for free, but some have charges. Make sure you read the fine print before you get started. If you use the IRS paperwork, you should only need to pay to print the form and for postage. 

How will the IRS process my amended return?

You can track the status of your Form 1040-X for this year and up to three years prior using the IRS’s online tool, or by calling the IRS at 866-464-2050 (though the IRS advises you not to call). To track it, you’ll need to enter your Social Security number, date of birth and zip code. However, note that it will take up to three weeks after you mail it to show up in the system, and processing can take up to 16 weeks. 

For more, check out all of the changes to expect on your tax return this year, the new tax credits you may be able to claim and what we know so far about a potential fourth stimulus check.