Ask the Tax Resolution Expert: Filing Amended Tax Returns
QUESTION: My brother opened a custodial stock account when my 4-year son was born. He did not tell me that he sold some long-term stocks in 2007 for a capital gain of $2,900. Since I did not know about it, I did not report it on a tax return. If I amend my tax return, then I was overpaid $260. If I file a return for my son, then he owes $215. How do I go about filing his return this late? What kind of penalties am I looking at?
ANSWER: Due to the tax amount being so immaterial in the scheme of things, I would just leave it alone and not do anything.
If you are stuck on filing a corrected return, you must do this on form 1040X (Amended tax return). As a tax resolution specialist who has helped thousands of taxpayers negotiate tax settlements, I have to remind you that the IRS is not obligated under law to accept an amended return. Also keep in mind that you have 3 years from the date the IRS received your 2007 return to amend it.
Got questions about IRS audits, penalties, wage garnishments, bank levies, or income tax relief in general? Visit www.taxresolution.com for a free tax relief consultation or call 866-IRS-PROBLEMS.
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