Penalties - To Amend or Not to Amend: Correcting Non-Compliance on Past Returns

By: Bryan C. Skarlatos and Stephen A. Josey
Journal of Tax Practice & Procedure
February - March 2019 Edition

Tax law is so complicated that nearly everyone makes a mistake sooner or later. What should a taxpayer do when he or she learns of a mistake on a previously filed tax return? Of course, if the taxpayer overpaid her tax, she probably will jump at the opportunity to amend the return and claim a refund. However, if the prior return underreported tax, is the taxpayer required to file an amended return to correct the understatement? And what are the consequences of filing an amended return? How should a tax practitioner advise a client? This column addresses when and how a taxpayer can or should file amended returns and how tax practitioners should approach issues relating to a taxpayer’s prior non-compliance.

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