Should I fix this on my 2010 tax return?

Question

I went to enroll into school today, and the financial aid counselor needed my 2010 tax return, I showed her my return, and she stopped and asked me, "Why do you have 3 exemptions?" And I told her that those are my 3 children. And then she asked me, "Why did I only claim 2 deductions?" , and I was in shock because I never paid attention to that this whole time when I did my taxes on turbotax. I don't know what I was thinking at that time, the only thing that comes to mind that I was going so fast since the turbotax automatically retrieved my w2 electronically without me having to type anything, and being that my daughter was born dec. 30th of 2010 and me filing in Jan. that I didn't think of it being a big deal. But the fin-aid counselor made a big deal about it and then dismissed it as if she didn't bring anything up, now I'm worried. I don't know squat about taxes so I'm afraid, did I do a bad thing? Should I go back and correct it? Thanks

Answer 1

Yes Rissa, you should go back and correct it. For two reasons: you will get more money from the IRS, and you will get better financial aid.



Step 1. Redo your 2010 return adding the baby. Print it and submit to the financial aid counselor but NOT to the IRS.



Step 2. Download form 1040X (see my link), lay down the old and the new return (you will need numbers from both), and try to complete 1040X carefully following instructions. Send 1040X to the IRS but not to the counselor.



The second step may be difficult to do yourself. See if you qualify for free professional help in my 3rd link. Good luck!



Michael Plaks, EA, Houston TX

www.MichaelPlaks.com

Answer 2

You will need to file an amended return, using Form 1040X. You have up to 3 years from the original due date to get your amended return to the IRS. After 3 years, no refund is available.



It may be a little tricky. Not all software programs do it correctly. You might want to pay for a professionally done return at a tax preparation agency - ESPECIALLY if you qualify for the Earned Income Credit and did not take it. Three dependents may equal several thousand dollars difference.



PS.. Could you have let the kid's other parent claim one of them?

Answer 3

If she asked you, "Why did you only claim 2 deductions" it's obvious that she has absolutely NO clue what she is talking about. A deduction is a dollar amount that reduces your taxable income. You can either claim the standard deduction of $5,700 (if Single, other amounts apply for Head of Household or Married) or you can itemize.



If she asked you why you have 3 exemptions, she's equally clueless, since each exemption would be listed by name on your return. You get a personal exemption for yourself and one for each child, so if you have 3 children your return would show 4 exemptions assuming that you are single.



Care to rephrase your question so that it makes some sense? I can think of a dozen possibilities and I'm not going to try and guess exactly what it is that you are asking.

Answer 4

no it is not a bad thing, you can amend your 2010 return with a 1040X but it probably will not result in additional refund to you

if that is the case, don't bother

Answer 5

It is not a bad thing, but you should fix it. You will probably get some money if you fix it.

Answer 6

IF it increases your return yes.

Answer 7

You'll get more money if you amend.