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nine0bison83 · Mar 29, 2007, 09:40 AM

I am thinking about filing an amended return for 2004. I discovered that our "tax guy" failed to included the mortgage interest that we paid for that year. Also, in looking at the paperwork, we noticed that he included daycare costs that we didn't necessarily have. :confused:

AtlantaTaxExpert · Apr 3, 2007, 03:41 PM

Your return has already been reviewed and accepted by the RS.

Technically, you should amend; howeever, if the amendment produces a tax of less than $50 or a refund of less than $50, it falls into 'de minimus" status and can be legally ignored.

jessincali · Apr 3, 2007, 05:56 PM

While I agree that with "atlanta tax expert" about the $50 comment - I don't with the other. Just because your return has been accpeted by the IRS DOES NOT MEAN it has been reviewed. You are not technically "safe" from audit until 4 years after your file date.
I would definitely amend your return (and don't forget to do it for state as well). If you are taking away the child care expense and adding mortgage interest - it should be relatively easy and not take very long - and hey - you may just get a refund. Just use amended tax form that can be found on IRS.gov.
I would also take a look at your past returns as well. If this "tax professional" missed something as basic as mortgage interest - he probably missed other things as well. Remember - you can go back 4 years. I believe a couple of the mainstream tax companies will review past years returns for a smaller fee if you aren't interested in doing it yourself.
Hope this helps!
Tax auditor in CA :)

Mobea · Apr 3, 2007, 06:21 PM

Did you actually have enough itemized deductions even with your mortgage interest to qualify for a Schedule A or did he take the standard deduction? That may be why you think that he didn't claim your mortgage interest.

jessincali · Apr 3, 2007, 08:02 PM

That is a good point. If you did not have enough itemized deductions - he would have taken the standard. Is that the only thing you have to itemize? That is generally the largest - but probably not the only. See if there is anything else you can add to the list (ie charitable contributions, medical expenses (after a threshold is met)).
Unless you have a really small mortgage - just your interest is probably enough. Remember to include certain closing costs if this is the first year you have owned it. A tax professional could make sure you pick up the right ones. Good luck!

Mobea · Apr 4, 2007, 04:57 AM

Closing cost get added to the cost basis of your home, not deducted on Schedule A

AtlantaTaxExpert · Apr 13, 2007, 12:14 PM

Mobea's points are excellent.

Jessincali:

The IRS typically runs 16-18 months behind on return reviews. They are currently doing 2005, which is the basis for my statement that the return has already been reviewed.

Amending the return NOW will probably draw undue attention to it. For any refund less than $200, it is, In my opinion, NOT worth the risk.

jessincali · Apr 13, 2007, 04:34 PM

Hmmm... You are probably right. I was basing my 4 year mark off being conservative - and the state I work for...
But you are right about it probably not being worth the risk for a small return.

AtlantaTaxExpert · Apr 20, 2007, 10:45 AM

Glad you agree!

Mobea · Apr 20, 2007, 11:08 AM

IF you could not itemize even with the mortgage interest and took the standard deduction and IF the child care expenses were overstated, then an amended return may reveal that you may owe taxes. In case of an audit, the IRS would compare what you deducted for child care to the EIN or SS# of the child care provider. They would look for the provider to claim the income to match what you claimed as a deduction.

AtlantaTaxExpert · Apr 20, 2007, 11:47 AM

Mobea's point are well taken!