Do you believe you’ve overpaid your income tax on a prior return? You can amend an old return by filing Form 1040X to report an overpayment and receive a refund of those overpaid taxes, plus interest. However, if the amount involved is not meaningful, you may want to forego the refund.
To get a refund, you’ll have to attach an explanation to Form 1040X. Some IRS employee will read that explanation and decide whether more questions need to be asked. For a minor amount, you may not want the added audit exposure.
The IRS insists that filing an amended return does not increase your audit risk. Indeed, the IRS can’t possibly audit the millions of amended returns that are filed each year. Nevertheless, filing Form 1040X does mean coming to the attention of the IRS one more time. On the other hand, if substantial amounts are involved, don’t hesitate to file an amended return, as long as you can justify your claim.
