We know you didn’t mean to do it. Now you’ve filed a totally incorrect tax return and you’re freaking out. “Why? Why did I tell the IRS I had a farm in Guam?”
It’s cool. You can fix it. Allow us to introduce you to Form 1040X. X as in, you are X-tremely bad at doing your taxes. No, just kidding. Bankrate says you should correct your return as soon as possible to prevent nasty things like interest and penalties:
Taxpayers also should be diligent about correcting their returns even if it means they end up paying a bit more in taxes.
Why? Because it’s a pretty safe bet that the IRS is going to discover your error eventually.
If it’s a simple addition or subtraction mistake, there’s no need to amend the return. The IRS says its computers will detect the error, notify you and adjust your return automatically.
But if it’s something bigger — you overlooked a Form 1099 for $1,500 you got from a freelance house painting job — and you catch and correct it first, it could save you from paying even more to the IRS.
The IRS may not penalize you for this honest mistake, but it sure will collect some interest on the proper amount you didn’t pay on time in the first place. The sooner you correct the error, the less interest you’ll face.