Stupid me didnt report my unemployment from 2006 on my tax return. WHat is going to happen? What should I do?
2007-09-25 05:17:57 · 9 answers · asked by Anonymous in Business & Finance ➔ Taxes ➔ United States
File amended federal (1040X) and state returns (whatever amended return for your state) including the unemployment. Otherwise, if you wait, you will get a notice from the IRS and probably your state saying that there is a difference on your income tax return between what your return and what was reported to the federal and state. You will get a bill from the IRS and the state for interest and penalties for not including the unemployment, but it will be less taking care of it now then waiting for the IRS and state to catch up with you.
2007-09-25 05:31:26 · answer #1 · answered by Anonymous · 3⤊ 0⤋
You can wait until the IRS sends you a letter, but that will cost you in interest and penalties if additional taxes are owed.
You need to file a Form 1040X and include the unemployment compensation. Pay the additional tax owed if any, or pay back the difference in refund. The IRS will bill you for the interest and penalties.
States vary as to the taxation of unemployment benefits. You may need to amend your state return as well.
2007-09-25 08:02:50 · answer #2 · answered by ninasgramma 7 · 0⤊ 0⤋
You need to amend your tax return. If you had a company do it, they will usually amend it for free. If you had taxes taken out of your unemployment, you might be alright. If you didn't, and you owe, you will have to pay the taxes plus penalties and interest. The sooner you do the amendment, the better of you will be because if you do owe, this will lessen the amount of interest they will charge you. Also, the IRS is very good about setting up payment plans, so even if you don't have all the money up front, they will usually work with you on that.
2007-09-25 05:53:18 · answer #3 · answered by katy c 1 · 0⤊ 0⤋
You should file an amended return on form 1040X including ALL of your income including the unemployment. If you owe additional tax, there will be interest on the unpaid amount from when it was due.
If you don't do this, you'll get a letter from the IRS refiguring your return and demanding payment if you owe. It can take a couple years for that to happen, and by that time the interest will have really added up. So fix it NOW.
2007-09-25 05:31:53 · answer #4 · answered by Judy 7 · 2⤊ 0⤋
If you don't file an amended return like other posters have suggested, IRS will send you a notice proposing an adjustment increasing your income by the amount of unemployment you received. As things go, this is a pretty routine item to miss. IRS will not make a big deal out of it as long as you pay up.
2007-09-25 08:14:56 · answer #5 · answered by Anonymous · 0⤊ 0⤋
Feds will send you a bill. Any day now. Estimate what you may owe and if you have the money handy to pay the tax and accrued interest, you could try a professionally worded letter asking to forgive the penalty they will assess. This is common, don't worry. They won't scourge you, and you have a good chance of the IRS forgiving the penalty if you respond promptly.
2007-09-25 05:28:02 · answer #6 · answered by Anonymous · 1⤊ 0⤋
Nothing to panic. File amended return 1040X and pay the tax due.
2007-09-25 06:06:47 · answer #7 · answered by MukatA 6 · 0⤊ 0⤋
Unemployment is taxable income. Depending on how much you got, and the rest of your personal situation, they might have deducted more than you owe. If so, you'd get any overpayment refunded.
2016-05-18 01:33:34 · answer #8 · answered by Anonymous · 0⤊ 0⤋
back charge with interest.
2007-09-25 05:25:08 · answer #9 · answered by Michael M 7 · 1⤊ 0⤋