# amend immediately or later?



## expatwien (Oct 17, 2015)

I submitted tax forms (and fbars) a few weeks ago under the streamlined program. I accidentally used a different exchange rate (too high) on the 1116 general income forms for 2012 than what was used elsewhere. This resulted in my foreign tax credit being higher than it should be, and my tax refund being higher than it should be (by $80).

The mistake should have been obvious to me, but I am new to the 1116 forms, and I didn't proofread carefully enough. It resulted in Gross foreign source income being greater than Gross income from all sources, which appears to be impossible, and should be obvious to the IRS.

Should I file an amended return immediately, or wait for a response from the IRS, and then file an amended return (or perhaps another variation). Maybe this falls under the category of 'math error', which the IRS can be expected to correct automatically.

Thanks for your advice.


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## BBCWatcher (Dec 28, 2012)

If the IRS has paid the refund, I'd go ahead and file a 1040X (amended return). Otherwise interest (at least) will accrue on the over-refund, and in my view it wouldn't be surprising if they catch that error eventually. I think you're right that it's impossible for those two numbers to be different in that way, and that seems like the sort of basic check the IRS would get around to eventually. They do overlook rounding errors, but a discrepancy big enough to generate a ~$80 excess refund is probably worth their sending a letter to you eventually.

I tend to think a 1040X and catching your own error puts you in good stead for future possible audits, so I just think it's something prudent to do. If you're demonstrating you're on top of things and trying to comply, that can't hurt if there's some serious dispute in the future. (It might not help, but it might.)

If the IRS hasn't paid the refund yet then you can probably wait and see if they catch it. If they catch it they'll presumably make their own correction. If you're happy with their correction and refund reduction, the matter is settled.

Keep records of any correspondence you get from the IRS and of the refund payment itself in your personal files, as always.


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## expatwien (Oct 17, 2015)

Thanks for the quick response. This was just 2 weeks ago, and the IRS hasn't yet responded either with a check, or with a questions. So it's best just to wait, and submit a 1040X if they don't catch it themselves?


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## BBCWatcher (Dec 28, 2012)

I think that's a reasonable approach in the circumstances, yes. If you get a check, check the amount. If it's the wrong amount (too high), go ahead and file a 1040X.

No direct deposit of your refund?


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## expatwien (Oct 17, 2015)

No, that is from 2012, and my understanding is that direct deposit is not allowed for previous years. I requested checks for 2012 and 2013, and direct deposit for 2014.


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## Bevdeforges (Nov 16, 2007)

Responsible alternative opinion here: wait and see if the IRS says anything before you make any amendments or adjustments. There is no one "correct" exchange rate to use. And frankly, $80 is not material in the world of the IRS.

If they adjust the amount of your refund or send you a letter indicating they have a problem with the rate you used, then see what they want you to do (if anything).

Really, they are very unlikely to bother you over $80.
Cheers,
Bev


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## expatwien (Oct 17, 2015)

Thanks for your perspective. I will wait for the IRS's response. However, if the IRS doesn't spot the error, I'm inclined to correct the error myself (via 1040X).


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## BBCWatcher (Dec 28, 2012)

See your other thread for one possible reason why you might want a 1040X anyway.


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