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2016 - Husband filed MFS timely, wife has not filed return. Can we amend the husband's return?


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Husband filed his 2016 1040 timely on extension - MFS and took the standard deduction.  Wife has not filed as of 11.10.2020.  Can the husband's return still be amended to MFJ to pick up wife's income?  (His statue would have been 7/1/2020) Also, can they now itemize instead of taking the standard deduction?  

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The only reason to do this would be to claim a refund, and it's likely too late for that.  If he owed, the statute is two years after he paid, so that might be a possibility.  She would have heard from IRS if she owed, so there's no point in her filing now, separately or jointly, again because it's too late to receive a refund. Why do people do this?  I had clients who came to me when the IRS attached paychecks.  I prepared six years of returns, all of which had refunds, and they forfeited thousands of dollars because it was too late to claim some of them. I felt for sure they would file on time religiously after that because they had two kids in college.  Nope.  They contacted me each year to file extensions and I reminded them that they would get $5k in AOC but they still never got their stuff together.  These were not wealthy people and they could have used that extra money. 

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The actual filing date allowed for amended returns is the later of 2 years after payment if taxes are owed or 3 years from the filing date.  If not on extension, then it's 3 years from 4/15 is used even if filed before the 4/15 deadline.  If the return is on extension until 10/15 and is filed after 4/15 but before 10/15, the actual date filed is considered the filing date, so the amended return would have a final date of 3 years from that, and I'm assuming this is the reason why the OP said the statute would have run out 7/1/20 for the 2016 tax year. 

Because the statute has run out for filing an amended return for the husband, there is no acceptable amendment possible that can be filed.

If the wife hasn't filed, whether or not the IRS has created a SFR (substitute for return) that she may have paid on a notice, I'd suggest that she file MFS claiming the standard deduction because an SFR isn't considered a filed return and doesn't start the statute of limitations running.  

 

 

Edited by jklcpa
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11 hours ago, jklcpa said:

The actual filing date allowed for amended returns is the later of 2 years after payment if taxes are owed or 3 years from the filing date.........

While that is the timeline for filing for a refund, I am not aware of any cutoff for filing an amended return for whatever other reason the taxpayer has in mind.

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The difference between them filing mfj and mfs is the tax owed.  Husband had very little income as he was a full time student,  therefore did not get benefit from standard deduction or nor was he  get benefit from AOC.  Wife will owe almost 7k in taxes before penalties and interest.  If we amend, tax owed goes down to about 1k before interest and penalties. Why do people do this, who knows!

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On 11/10/2020 at 6:37 PM, jklcpa said:

The actual filing date allowed for amended returns is the later of 2 years after payment if taxes are owed or 3 years from the filing date. 

Because the statute has run out for filing an amended return for the husband, there is no acceptable amendment possible that can be filed.

If the wife hasn't filed, whether or not the IRS has created a SFR (substitute for return) that she may have paid on a notice, I'd suggest that she file MFS claiming the standard deduction because an SFR isn't considered a filed return and doesn't start the statute of limitations running.  

 

 

I would like to clarify a few things.

The 2 and 3 year limitation on amending returns is , the limit for receiving Refunds.  Any return with  balance due can be amended, no matter how old.

The husbands return can not be amended, but the wife has not filed.  She can file as the primary and incorporate hubby in the return as secondary.

SFR's are no longer being prepared.  The ASFR unit was shut down Sep 2017.  So, that won't be an issue.   http://www.taxabletalk.com/2017/09/26/irs-suspends-asfr-program/

You are correct in that the IRS does not consider an SFR'd return as a filed return, but that is to prevent SFR's being discharged in BK.

In other aspects, the IRS treats the SFR as a tax return.  The CSED begins running its 10 years on the date of the first assessment.  It also allows the SFR to be amended.   

Many people make the mistake of filing a return as a regular 1040.  This creates a new CSED date, the date of filing.   If the return is amended (don't use 1040X - just write AMENDED across the top of form 1040), it will retain the original CSED date.

 

 

 

 

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47 minutes ago, Max W said:

The husbands return can not be amended

Why?

I have recently filed an amended return where husband filed separate and wife did not file.

Husband had a balance due which was mostly offset on amended return by wife's business loss.

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