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I filed my tax return the first week of February.

In the last few weeks, I've received 3 Schedule K forms. 2 of the 3 relate to IRA holdings. I didn't take any IRA distributions in 2003.

I also received an amended 1099 from my broker.

I'm trying to determine the requirements for amending my return:

1 - do I need to do anything with the Schedule Ks for the IRA investments? My inclination is to toss them.


Not so fast. Your IRA may have to file and pay taxes. If your IRA receives more than $1000 in Unrelated Business Income (UBI) it must file a Form 990-T and could be liable to pay taxes on that income. I assume that your IRA is invested in a partnership of some sort. If your K-1s have entries on lines 1-3, your IRA has UBI.

2 - the Schedule K for the taxable stuff doesn't change the bottom line of my return. Neither do the changes in the 1099. Do I need to amend my return if the tax doesn't change at all?

Not unless there is a carryforward amount that is altered by the changes or there is a change in a number reported to the IRS but the corresponding offset (which changes) is not reported.

What I mean by the latter comment is the following. If you were to receive a corrected 1099-B showing the redemption of a $10000 bond (for $10000), the IRS would only have the "sell" side of the transaction. If you originally purchased the bond for face value, there would be no net capital gain, but the IRS doesn't know the "buy" side information until you report it. In this case the IRS would be looking for the tax on 10K of capital gains if you didn't file an amended return.

Ira
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