9 Easy Ways to Reduce Your Tax Bill Series - Tax Tip #8

Over the next weeks we are going to provide you 9 easy ways to reduce your tax liability - 2016 Edition. Every Monday and Wednesday we will be posting a new tip, so stay tuned!

Tax Tip #8

When you find an error in your tax work for a particular tax year, you may have more than just that year to worry about. If an error was made, it is often carried forward from previous years, so look at the previous year’s return as well. Even if there’s an error in your favor, amend those returns. Form 1040X can be used to go back up to three years. Many people are afraid to ask for errors to be corrected.

Many taxpayers believe, irrationally, that the IRS will look for other things “to get even” for filing for an additional refund. This is simply not the case. If you underreported deductions, or over reported income and subsequently paid too much tax, the IRS is happy to refund from prior years.