Amending Tax Returns


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0b3hks001

I will be amending 2003 tax return (Form 1040) for omitting
a worthless securitiy. That will affect the Capital Loss
Carryover from 2003 to 2004; AND 2004 to 2005.

Do I need to amend 2004 tax return because of the
flow-through?? [There are no other changes in 2004's tax
return.]

TIA
 
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L

LTSLLC

Yes, you shold file a Form 1040X for 2004.

File it together with the 2003 1040X (and 2005's 1040X if
you already filed the 2005 original return) so that a single
IRS person will handle all 3 years at once.

Also, in case the 1040X's are processed separately by
different IRS persons, you should staple a copy of the 2003
1040X to the 2004 1040X, and staple a copy of the 2003 and
2004 1040X to the 2005 1040X, to show where the carryover is
coming from.

Rudy
www.LizcanoTaxServicesLLC.com
 
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LTSLLC

I forgot to mention that on the copies, be sure to write
"Copy - Do Not Process" at the very top and even bottom.

That will ensure that your 1040X for 2003 and 2004 don't get
processed twice.

Rudy
www.LizcanoTaxServicesLLC.com
 
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0

0b3hks001

LTSLLC said:
Yes, you shold file a Form 1040X for 2004.

File it together with the 2003 1040X (and 2005's 1040X if
you already filed the 2005 original return) so that a single
IRS person will handle all 3 years at once.

Also, in case the 1040X's are processed separately by
different IRS persons, you should staple a copy of the 2003
1040X to the 2004 1040X, and staple a copy of the 2003 and
2004 1040X to the 2005 1040X, to show where the carryover is
coming from.
I haven't file my 2005 Return. I am planning to file the
Amended returns for 2003 and 2004; wait a couple of weeks,
then file my 2005 Return. Do I need to attach my 2003 and
2004 Amended returns to the 2005 1040?

I guess I can also file an extension for my 2005 Return; and
mail in my 2005 1040 later. If so, how long should I wait?

TIA
 
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L

L K Williams

LTSLLC wrote:
I haven't file my 2005 Return. I am planning to file the
Amended returns for 2003 and 2004; wait a couple of weeks,
then file my 2005 Return. Do I need to attach my 2003 and
2004 Amended returns to the 2005 1040?

I guess I can also file an extension for my 2005 Return; and
mail in my 2005 1040 later. If so, how long should I wait?
I don't see any reason to wait, unless you will owe money on
the 2005 return -- in which case you should file on 4/15
anyway.

Checking carryovers, etc. is not part of the initial
processing of returns. By the time anyone at IRS gets
curious about a carryover, all the returns should have been
processed and the information can be determined from their
records. Even if they don't catch this and write to you,
all you would need to do is send a copy of the amended
return generating the carryover.

I also disagree with the advice to send the 2003 and 2004
returns together. ALWAYS send each years return separately.
IRS is known for failure to recognize that two separate
returns are enclosed. All the papers can be stapled
together and only the one return processed.

Lanny K. Williams, CPA
Nawarat, Williams & Co., Ltd.
Income Tax Services for Expatriate Americans
 
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L

LTSLLC

You don't need to attach the 2003/2004 copies to your
original 2005 tax return.

DO send in the 2003/2004 1040X's together. Staple them so
that the 2003 1040X is on top of the 2004 1040X and about 1
inch below the top of the 2004 1040X so that both can be
easily seen.

My advice on sending in the two 1040X's together is based on
20 years experience working at the IRS, with 12 of those
years in IMF Adjustments (now called Tax Accounts) where
your 1040X's will be processed.

Rudy
www.LizcanoTaxServicesLLC.com
 
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L

L K Williams

LTSLLC said:
You don't need to attach the 2003/2004 copies to your
original 2005 tax return.

DO send in the 2003/2004 1040X's together. Staple them so
that the 2003 1040X is on top of the 2004 1040X and about 1
inch below the top of the 2004 1040X so that both can be
easily seen.

My advice on sending in the two 1040X's together is based on
20 years experience working at the IRS, with 12 of those
years in IMF Adjustments (now called Tax Accounts) where
your 1040X's will be processed.
Hi Rudy. With all due respect, I would disagree about
filing the returns together. I've been doing tax returns
for close to 30 years and I did have some problems in the
early years when filing more than one return at a time. So,
for most of my career, I have had my clients mail multiple
returns in separate envelopes.

To me, the extra postage for two or more envelopes is a
small price to pay to be sure IRS actually processes each
separate return. Maybe the service has changed/improved
processes but I still think it is not worth the risk.

Lanny K. Williams, CPA
Nawarat, Williams & Co., Ltd.
Income Tax Services for Expatriate Americans
 
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H

hlunsford

Hi Rudy. With all due respect, I would disagree about
filing the returns together. I've been doing tax returns
for close to 30 years and I did have some problems in the
early years when filing more than one return at a time. So,
for most of my career, I have had my clients mail multiple
returns in separate envelopes.

To me, the extra postage for two or more envelopes is a
small price to pay to be sure IRS actually processes each
separate return. Maybe the service has changed/improved
processes but I still think it is not worth the risk.
What I advocate is placing each return in a separate
envelope, marked with the year, and then placing both
envelopes in a larger one. Saves postage.

However, I can agree with the the other poster in that it
has been my experience in 32 years of practice there's no
problem in sending multiple returns in one envelope.

ChEAr$,
Harlan Lunsford, EA n LA
 
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L

L K Williams

What I advocate is placing each return in a separate
envelope, marked with the year, and then placing both
envelopes in a larger one. Saves postage.

However, I can agree with the the other poster in that it
has been my experience in 32 years of practice there's no
problem in sending multiple returns in one envelope.
In the end, it's a matter of opinion and experience, isn't
it? For me, using separate envelopes is just one of those
things I do. It's kinda like George Burns used to say: " I
still chase girls but I've forgotten why." I know I had
problems years ago but that was years ago; I've forgotten
what those problems were but I still keep up the old
practice.

Is this a sign I'm getting old?

Lanny K. Williams, CPA
Nawarat, Williams & Co., Ltd.
Income Tax Services for Expatriate Americans
 
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L

LTSLLC

Lanny and Harlan,

I'd advise go with what has worked for you before but here
are the reasons to my madness :)

When you send them separately, several things can occur that
may delay the processing or even give you different tax
adjustment results.

The IRS policy is for one employee to work all the cases for
a taxpayer. This is done so that processing and adjustments
of several cases is consistent. If several returns post on
different years are assigned to several employees, then the
processing of the returns doesn't start until all the cases
are reassigned to one employee.

This can lead to delays due to reassigned cases getting
lost, or taking several days to weeks to get routed to the
one employee. Also, if one of the cases is assigned to an
employee that is out on leave, then that case may not get
reassigned until the employee returns. Even then, since
additional work has been assigned to the employee out on
leave, he/she may not actually reassign the case to the one
employee for several days after returning.

What happens many times when more than one employee works
several cases from one taxpayer is inconsistent tax
adjustments. One employee may request further documentation
or disallow the claim on one year while another employee
will allow the same claim but for a different year. Also,
one employee may route their case to the audit group while a
different employee will allow the claim.

If you send in multiple tax returns such as claims (Form
1040X) for multiple years stapled together, then you usually
will get all of the returns assigned to one employee. With
one employee, you will at least get consistent treatment on
all of the returns/claims and there will be minimal delay in
processing them.

One thing I hated hearing from taxpayers, representatives,
preparers, etc. when I worked at the IRS was how they kept
getting different answers to the same question, or have them
call up and yell at me because one of their claims got
denied but the exact same claim for a different year was
allowed.

Rudy
www.LizcanoTaxServicesLLC.com
 
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S

Stuart A. Bronstein

In the end, it's a matter of opinion and experience, isn't
it? For me, using separate envelopes is just one of those
things I do. It's kinda like George Burns used to say: " I
still chase girls but I've forgotten why." I know I had
problems years ago but that was years ago; I've forgotten
what those problems were but I still keep up the old
practice.

Is this a sign I'm getting old?
Nah. Just that as they say, if it's not broke, don't fix it.

Stu
 
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