Can someone explain a tax ammendment to me?

Question

we had our taxes done with a new accountant and he told us it would benefit us to do an ammendment back three years because I had never claimed my health insurance premiums that were paid out of pocket and our prior accountant did not get us back enough...said he was too conservative. what do you think?

Answer 1

Amending your tax return just means changing it after it's filed. There's a special form, 1040X to do it.

Whether you should depends on how much you would get back, and how much it would cost to have the accountant prepare the amended returns. The accountant should easily be able to give you a pretty good idea of what your tax savings would be, and how much he'd charge - then you can make your decision whether it's worth it or not.

Answer 2

This is called "Filing an Amended Tax Return". You can do this in order to "change" some information that you had previously reported to the IRS. If you come up with additional information, you file an Amended Return, and basically, it says "Never mind the original one I filed, IRS...here's the latest, greatest information."

It's possible that your prior accountant wasn't aware that you could write off the out-of-pocket healthcare premiums. But if that's the case, its a very good thing that you have a new accountant.

Answer 3

An amended tax return is used to refile or show corrections to a previously filed tax return. Based on the reason for filing one ( forgot to report all income, forgot to take a deduction or credit etc) will determine whether you owe additional tax or have a refund coming, Apparently your current accountant wants to include the medical expenses on a prior year return, Medical expenses are only deductible to the extent that they exceed 7.5% of your Adjusted Gross Income for that particular year, and you must be itemizing your deductions for that year to be able to qualify to claim the medical expenses, you might want to review your returns yourself before paying someone to file an amended return to see if it is going to be beneficial to you. ei they want to charge you 150.00 to get a $50.00 refund