Andy originally reported $21,000 as his adjusted gross income on his 2024 Form 1040. He received another Form W-2 for $500 after he filed his return. Which of the following is true? A. Andy should file another Form 1040 for 2024B. Andy should re-file Form 1040 for 2024C. Andy should include the $500 on his 2025 Form 1040D. Andy should use Form 1040-X – Amended U.S. Individual Income Tax Return to correct the 2024 Form 1040
The Correct Answer and Explanation is:
The correct answer is D. Andy should use Form 1040-X – Amended U.S. Individual Income Tax Return to correct the 2024 Form 1040.
Explanation:
When an individual realizes there has been an error in their previously filed tax return, such as the omission of income, they are required to amend that return. In Andy’s case, he initially reported $21,000 as his adjusted gross income (AGI), but after filing, he received an additional Form W-2 reporting $500 in income. This additional income must be included on his 2024 tax return to accurately reflect his total earnings for the year.
The Form 1040-X, the Amended U.S. Individual Income Tax Return, is specifically used to correct errors or omissions on a previously filed tax return. It allows taxpayers to make adjustments to their income, deductions, credits, or tax payments that were reported incorrectly in the original return.
Here’s why the other options are not correct:
- A. Andy should file another Form 1040 for 2024: Filing a new Form 1040 is not the correct approach. Once a return has been filed, it cannot be simply replaced with a new one. Any adjustments or corrections need to be made on an amended return (Form 1040-X).
- B. Andy should re-file Form 1040 for 2024: Re-filing the same Form 1040 would not update the original return. Similar to option A, this would not include the necessary corrections.
- C. Andy should include the $500 on his 2025 Form 1040: This is incorrect because Andy needs to correct the 2024 return. The $500 in income pertains to the 2024 tax year, and therefore, should be reported on that year’s return, not on the 2025 return.
By using Form 1040-X, Andy can properly amend his 2024 tax return to include the $500 income and recalculate his tax liability. If the amendment results in additional taxes owed, Andy will be required to pay the outstanding amount, potentially with interest and penalties if the correction is made after the original due date.
