Do I Need to Amend My Business Tax Return? – In general, you will need to file an amended return for LLCs, Partnerships, and Corporations if a substantial error was made that will affect what you owe or if there is new and vital information that needs to be included or changed.

Amending My Business Tax Return

Typically, you have two or three years to file an amended return for a given tax year. The forms and statements needed with an amended return vary based on your business type. Some changes don’t require you to file an amended return, while others do.

You don’t need to file an amended return if:

  • Minor math errors in the original return – the IRS will make the changes
  • Some tax forms were missing —the IRS will ask for these

Examples of when you Must file an amended business tax return are: 

  • A substantial error was made on your return that will affect your tax liability (the amount you owe)
  • You received new information that needs to be included
  • Your income, deductions, tax credits, refund amount, or dependent information changes
  • You received notification from the IRS about adjustments to your business return

As a best practice, business owners should contact their tax professional to determine if an amended business return is needed. 

The process, forms, and statements needed to amend a business return differ depending on the type of business and the original business tax file. 

Amending Schedule C

You’ll use Schedule C to report business taxes for a sole proprietorship or a single-member LLC. Schedule C is included in your personal tax return, so you must amend your business taxes to amend your personal tax return.  If the change in Schedule C changes your business net income (profit) amount, it may change the rest of your tax return, including possibly your self-employment tax amount.

Amending S Corporation Tax Returns

To amend an 1120-S tax return for an S corporation, you must Attach a statement that lists each amended item, the right amount for each item, and an explanation for why you made each change.  Also, suppose the change in S corporation taxes results in a shift in shareholder information. In that case, you must also file an amended Schedule K-1 and give a copy of the amended K-1 to the shareholder with an indicator that it is an amended K-1.   

Amending a Partnership or Multiple-M ember LLC Tax Return

If amending a partnership or multiple-member LLC, the 1065 return will need to include a statement that identifies the line number of each amended item, the corrected amount or treatment of the item, and an explanation for each change.

Amending your tax return due to changes to your Schedule K-1 

If you are a shareholder in an S Corp, a partner in a partnership, or a member of a multiple-member LLC business,  you receive a changed Schedule K-1 after filing your personal tax return.  You must amend your personal 1040 tax return to reflect the changes, including any changes that affect your self-employment income. 

MSM is Your Business Partner

The tax professionals at MSM Advisors exercise extreme diligence in preparing our client’s business and personal tax returns to ensure 100% accuracy and compliance with current tax laws and regulations. In addition, numerous safeguards and quality assurance practices are in place throughout the process to avoid errors and omissions in all tax returns filed on behalf of clients. However, you should always contact MSM Advisors immediately if you receive new or changed information that can affect your business’s tax liabilities or if you have questions or concerns that an amended tax return for your business may be necessary.

MSM Advisors is a trusted and experienced CPA firm that provides professional tax services for small to mid-sized businesses. Let’s schedule a complimentary consultation to see if we are a good fit for your business.

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