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Barbara
Barbara, Enrolled Agent
Category: Tax
Satisfied Customers: 2864
Experience:  18+ years of experience in tax preparation; 25+ years of experience as a real estate/corporate paralegal.
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How do you amend a return to include the adoption credit?

Customer Question

How do you amend a return to include the adoption credit?
Submitted: 1 year ago.
Category: Tax
Expert:  Lane replied 1 year ago.

Hi,

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I hold J.D. (Duris Doctorate -a Doctoral degree in the law), MBA (Finance & Tax specialization), a BBA from Mercer University's Stetson School of Business & Economics, as well as CFP and CRPS (Chartered Retirement Plans Specialist) designations - I can help

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First, (I may be stating the obvious, but just to set up a foundation for our discussion) ANY amended return is done by re-calculating your return as if you had taken the credit [or made some other change] ... and then filling in the resulting changes on the 1040x (amended return)

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The 1040X has three columns (and Turbotax and the other packages all handle this - will generate a 1040X) for the general subtotals of the return ...the 1040X doesn't have every line of the tax return, but rather has some of the important totals that come from the 1040 itself.

(For example, the first line of the 1040X is AGI - Adjusted Gross Income - which is actually the bot***** *****ne of page 1 of the actual tax return)

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The three columns are "A. Original amount ...," B. Net change— amount of increase or (decrease)...," and "C. Correct amount."

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So for the first line where you have all three columns you'll enter AGI as it was on the return that was filed in column A, then enter the new number in column C, and then do the math (some of the packages do this part for you) to see the change in column B ... how much the number (AGI in this example) went up or down from the previously filed return.

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There there is a large boxin part III where you explain why things changed ... in this case, you'll simply say "amending return to claim the adoption credit

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SO, you'll need to have your return as filed (those summary numbers going into column A)

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Then you'll need to completely re-do the return claiming the adoption credit ... which means filling out and attaching to your return Form 8839, Qualified Adoption Expenses. (you should also include the substantiation for the credit such as an adoption decree or subsidy agreement).

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Here's an excellent overview of the documentation needed and then you'll see the specifics in the instructions TO the 8839 (https://www.irs.gov/pub/irs-pdf/i8839.pdf)

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Because of these documentation requirements, any taxpayer claiming the adoption credit must file a paper return, rather than filing electronically, and attach all required documentation. It is necessary for the IRS to review the documents submitted. Normally, for a tax return claiming the adoption credit, it takes about six to eight weeks to get a refund claimed on a complete and accurate paper return where all required documents are attached.

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Ans amended returns ALSO need to be sent as paper returns, so that likely extends things further.

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But again, once you INCLUDE the form 8839 with the return, and the results of the 8839, flow back to the 1040 (reducing the income) three of those totals on the new 1040 where you INCLUDED the form 8839 will change (Taxable Income, Total Tax, [payments won't change], Refund or amont you owe).

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you'll then transfer those new numbers to column C, on the 1040X and file

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Please let me know what questions you have fom here

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Lane

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Expert:  Barbara replied 1 year ago.

Different expert here - my name is ***** ***** I have a different answer.

Taxpayers claiming the adoption credit CAN efile their tax returns and do not send in any supporting documentation to the IRS. The supporting documentation is to be kept with your tax documents. The only reason you cannot efile now is because efiling is closed for tax year 2014.

You will file Form 1040X with only Form 8839 attached to it.

If you are only adding Form 8839, Columns A and C of Lines 1 through 14 on Form 1040X will remain the same. You will need to fill out Form 8839, and you will begin making changes on Line 15 of and continue through to the bottom of Page 1. You will also provide an explanation in Part III on Page 2--This tax return is being amended to include Form 8839.

If you need assistance with Form 8839 and Form 1040X, I will be glad to walk you through it.

Thank you and best regards,

Barb

Expert:  Barbara replied 1 year ago.

Just following up with you to see if you have any other questions. If so, please come back to me here at your convenience, and I will be happy to assist you. If not, please take a moment to rate my answer since that is the only way I receive credit for answering you and alerts Just Answer to compensate me for a portion of the fee you previously paid.

Best regards,

Barb

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