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Financial Planning / Tax Strategies
|Subject: How to return a refund?||Date: 3/15/2001 12:49 PM|
|Author: mrnethack||Number: 48468 of 124471|
I just discovered I made an error on my tax return and need some advice.
I receive my payslip via the internet, and used my 12/31/2000 information to fill out and file my taxes in January. By the end of the month I had received a nice $7500 refund (6000 Fed, 1500 State) which I put in my money market account and haven't touched yet.
I received my W-2 by February 1 and filed it away, figuring I had done everything correctly with TurboTax. Last night I was cleaning up my tax records and decided to open the W-2.
I was shocked to discover that the total tax actually withheld was different than how my company showed it on the internet. I called my payroll department this morning and discovered that they are right and I filed the wrong amount of tax withheld. I should get a Federal refund of 3 dollars and owe the State about $350.
So my question is, what is the best approach to fix this error? I know I will probably have to file a form 1040X but at the bottom of it there is a paragraph asking why the error occurred. TurboTax offers no advice on the subject.
I'm worried about possible penalties for taking Uncle Sam's money and then having to return it. The form doesn't say whether there are any penalties and it doesn't say if I should send a check for the money along with the form? Does the IRS bill me once they receive the 1040X?
Any advice would be greatly appreciated, as I don't know how best to proceed.
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