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Need to file 1040X/540X despite no net change?

I already filed my 1040/540 (Calif). I reported zero total tax and both fed and Calif refunds (overpayments).

Later, I realized I had omitted some Other Income (IRD) and 1099-OID and

1099-B data.

Those changes do increase both fed and Calif AGI and Item Deductions.

But I still have zero total tax and the same amount of refunds. Also, there was no fed or Calif withholding.

Should I file Forms 1040X/540X in order to document the changes, even though there is no change to total tax and refunds?

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In a previous discussion of just the missing IRD income, Alan Kalman agreed that no amended returns are needed.

But I wonder if the missing 1099 data change the answer because the IRS and FTB have a record of them and might notice their omission.

I hope the IRS and FTB would realize there is no net effect, so they would not even send me a notice, much less require amended forms.

Reply to
qguy
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You don't a get a notice from the tax authorities if the missing income does not change your tax liability. You do not have to amend.

Reply to
Alan

You don't a get a notice from the tax authorities if the missing income does not change your tax liability. You do not have to amend. ========I agree. If the change doesn't cause a tax to appear (or disappear), no real need to amend - and just deal with any notice should it come.

However, if it makes you feel better to do so, you may amend... The IRS loves the extra work!

Reply to
D. Stussy

True, but with 1099-B data, the IRS and CA will assume that the gross proceeds are 100% taxable income unless you file an amended return. They won't take cost basis into consideration.

Ira Smilovitz

Reply to
ira smilovitz

Is that still true even if cost basis is officially reported to the IRS on the 1099-B, under the newer reporting rules now in place?

Reply to
Mark Bole

Thanks. As I expected; but it doesn't hurt to ask.

Reply to
qguy

I don't know. I haven't seen that situation yet.

Ira Smilovitz

Reply to
ira smilovitz

"ira smilovitz" wrote in message news: snipped-for-privacy@googlegroups.com... True, but with 1099-B data, the IRS and CA will assume that the gross proceeds are 100% taxable income unless you file an amended return. They won't take cost basis into consideration. =========== Not true anymore if basis is reported. They now must consider it if it's on the 1099-B (or 1099-S).

Reply to
D. Stussy

Seems logical, but is there a cite somewhere to document this? A change in the IRM instructions for how to create a SFR?

(Just curious. I don't claim to know the answer.)

Don EA in Upstate NY

Reply to
Don Priebe

Seems logical, but is there a cite somewhere to document this? A change in the IRM instructions for how to create a SFR?

(Just curious. I don't claim to know the answer.) ============= Probably in the IRM somewhere.

What I remember is that if the IRS has some proof of a deduction when computing an SFR, it must consider it, unless an election is involved. Elections require taxpayer action (i.e. filing).

One of my SFR cases from 1993 involved a sale of a primary residence. The taxpayer, when contacted, said she owed nothing after the "one time $125k exclusion for over age 55" was applied. That was numerically true, but she didn't understand that such was an election that she had to file a return to make in order to zero-out her tax. She finally got a tax professional to represent her who understood the difference. The case eventually closed with an assessment of zero when I secured a return with the election. Without the election, she would have owed quite a bit.

In another SFR which included a Schedule C business, I had information regarding rental payments by the business to the landlord (left over from another year which the taxpayer did file), so a deduction was permitted.

Reply to
D. Stussy

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