A friend filed electronically this month, and then a few days later
got an amended 1099-B from his broker. When he ran the numbers, he
saw that filing his tax would have him getting a larger refund by
about $40. In other words, by _not_ amending his return, he's paying
about $40 more in tax than the law requires.

Is he in fact obliged to file an amended return in such a situation,
or can he say "the pain of printing and mailing paper returns isn't
worth $40 to me"? My understanding is that understating your income
or overstating your deductions is illegal, but the other way around
is not.

And if he's legally allowed to skip the amended return, is the amount
a factor? Suppose it was $4000 instead of $40? (As a practical
matter, I don't know anyone who would forgo an extra $4000, but I'm
curious about what the law says.)

--
Stan Brown, Tehachapi, California, USA https://BrownMath.com/
Shikata ga nai...

--
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On Tuesday, March 22, 2022 at 1:45:50 PM UTC-4, Stan Brown wrote:

A friend filed electronically this month, and then a few days later
got an amended 1099-B from his broker. When he ran the numbers, he
saw that filing his tax would have him getting a larger refund by
about $40. In other words, by _not_ amending his return, he's paying
about $40 more in tax than the law requires.

Is he in fact obliged to file an amended return in such a situation,
or can he say "the pain of printing and mailing paper returns isn't
worth $40 to me"? My understanding is that understating your income
or overstating your deductions is illegal, but the other way around
is not.

And if he's legally allowed to skip the amended return, is the amount
a factor? Suppose it was $4000 instead of $40? (As a practical
matter, I don't know anyone who would forgo an extra $4000, but I'm
curious about what the law says.)

--
Stan Brown, Tehachapi, California, USA https://BrownMath.com/
Shikata ga nai...

--

You are never required to amend your return, even if it leads to increased tax due. (That doesn't mean the IRS might not correct your return and charge you both interest and penalties if you don't). I'm not sure I understand the "pain of printing and
mailing paper returns" when Form 1040X can be e-filed. But, the decison is his.

Ira Smilovitz, EA
Leonia, NJ

--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
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<< Copyright (2011) - All rights reserved. >>
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On Tue, 22 Mar 2022 15:50:28 EDT, ira smilovitz wrote:

On Tuesday, March 22, 2022 at 1:45:50 PM UTC-4, Stan Brown wrote:

A friend filed electronically this month, and then a few days later
got an amended 1099-B from his broker. When he ran the numbers, he
saw that filing his tax would have him getting a larger refund by
about $40. In other words, by _not_ amending his return, he's paying
about $40 more in tax than the law requires.

Is he in fact obliged to file an amended return in such a situation,
or can he say "the pain of printing and mailing paper returns isn't
worth $40 to me"? My understanding is that understating your income
or overstating your deductions is illegal, but the other way around
is not.

And if he's legally allowed to skip the amended return, is the amount
a factor? Suppose it was $4000 instead of $40? (As a practical
matter, I don't know anyone who would forgo an extra $4000, but I'm
curious about what the law says.)

You are never required to amend your return, even if it leads to increased tax due. (That doesn't mean the IRS might not correct your return and charge you both interest and penalties if you don't). I'm not sure I understand the "pain of printing and

mailing paper returns" when Form 1040X can be e-filed. But, the decison is his.

Thanks, Ira. I guess by "Form 1040X can be e-filed" you mean that the
IRS is set up to accept 1040X electronically. I'm not sure which
software he uses, other than that it's PC-based and not Web-based,
but he says it won't do amended returns. He's pretty computer savvy,
so I doubt he would have missed that opportunity in his software if
it exists.

Anyway, thanks for confirming that the option is his, and no legal
penalties are to be feared.



--
Stan Brown, Tehachapi, California, USA https://BrownMath.com/
Shikata ga nai...

--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2011) - All rights reserved. >>
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"ira smilovitz" wrote in message news:dda90d48-30ae-49e4-93ee-af6ad8c33a96n@googlegroups.com...

On Tuesday, March 22, 2022 at 1:45:50 PM UTC-4, Stan Brown wrote:

A friend filed electronically this month, and then a few days later
got an amended 1099-B from his broker. When he ran the numbers, he
saw that filing his tax would have him getting a larger refund by
about $40. In other words, by _not_ amending his return, he's paying
about $40 more in tax than the law requires.

Is he in fact obliged to file an amended return in such a situation,
or can he say "the pain of printing and mailing paper returns isn't
worth $40 to me"? My understanding is that understating your income
or overstating your deductions is illegal, but the other way around
is not.

And if he's legally allowed to skip the amended return, is the amount
a factor? Suppose it was $4000 instead of $40? (As a practical
matter, I don't know anyone who would forgo an extra $4000, but I'm
curious about what the law says.)

--
Stan Brown, Tehachapi, California, USA https://BrownMath.com/
Shikata ga nai...

--

You are never required to amend your return, even if it leads to increased >tax due. (That doesn't mean the IRS might not correct your return and
charge you both interest and penalties if you don't). I'm not sure I >understand the "pain of printing and mailing paper returns" when Form 1040X >can be e-filed. But, the decison is his.

Ira Smilovitz, EA
Leonia, NJ

Maybe a better way of asking this is, is a person legally required to take
all required deductions and incomes deductions to which he/she is entitled?

For example, can a taxpayer elect to itemize deductions and take zero deductions, even though the standard deduction would clearly be more beneficial? Or can a taxpayer legally declare zero dependents, even if the truth is that he/she has one or more dependents? Can a taxpayer legally
elect not to take advantage of credits like the child care credit?

As Stan said, I have no idea why anyone would choose to do this, other than perhaps to make some kind of statement about the tax system or perhaps to
try in a small way to reduce the national debt.

--

--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
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On 03/22/2022 23:24, Stan Brown wrote:

Anyway, thanks for confirming that the option is his, and no legal
penalties are to be feared.

Not to beat this to death, but I was looking for citations,
and this is the best I could do on short notice.
Interesting that, though the taxpayer is not required to
amend, the practitioner must advise him or her that he or
she should amend.

"The Supreme Court held that, despite these and other
references to amended returns in the Treasury regulations,
"[n]one of these provisions, however, requires the filing of
[an amended return]" (Badaracco, at 397). Similarly, the Tax
Court held that taxpayers are not required by statute to
file an amended return when an originally filed tax return
is discovered to be incorrect and that the failure to file
an amended return in this context does not, by itself,
establish an intent to evade tax (Broadhead, T.C. Memo.
1955-328).

CIRCULAR 230 AND SSTS CONCERNS

While taxpayers are not required, by statute or otherwise,
to file amended returns to correct errors or omissions, tax
practitioners are held to a higher, albeit different,
standard. Practitioners authorized to practice and represent
taxpayers before the IRS are bound by Treasury Circular 230,
Regulations Governing Practice Before the Internal Revenue
Service (31 C.F.R. Part 10). Section 10.21 of Circular 230
requires any practitioner who knows or discovers that a
client has not complied with the federal tax laws or that a
client has made an error or omission on any return,
document, affidavit, or other paper submitted or executed
under the federal tax laws must advise the client promptly
of the noncompliance, error, or omission and its
consequences. However, nothing in Circular 230 requires
correction of the noncompliance, error, or omission or
disengagement when the client refuses to make the
correction. Ultimately, the option to correct is at the
client's discretion."

https://www.journalofaccountancy.com/issues/2017/feb/amending-a-tax-return.html

--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2011) - All rights reserved. >>
<< ------------------------------------------------------- >>

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