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The IRS sent me a note proposing changes to my 2018 taxes, and asking me to pay them a few thousand dollars.

I accepted their changes and paid them.

I've now learned that their changes were wrong and I don't owe them. Is it too late to fix? I think I should file an amended tax return (the way I think it should be now, probably with an account's help) and they'll give my money back? Is that right?

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  • You might want to give a bit more context as to why you accepted the prior IRS changes vs what you've learned now. Is this for a business or personal? Is your new change rule based or mis-identified amounts or something else?
    – Morrison Chang
    Commented Oct 6, 2020 at 21:48
  • It might depend on whether the mistake was made by you or the IRS. I would call the phone number on the CP2000 you originally received (if you still have it), explain the situation and ask how you should proceed. Prepare to be on the phone for a long time, possibly hours.
    – TTT
    Commented Oct 6, 2020 at 23:19
  • > You might want to give a bit more context @MorrisonChang It's personal. My work (Amazon) grants RSUs. I think I forgot to include the 1099 for the sale of that stock in my original taxes. The IRS's "proposed changes" consider that whole amount income, and added it to my originally reported income. I accepted the change. Then I learned that the value of the RSUs is included in my W2, so already counted as income. (So for the 1099 I actually just owe the very minimal capital gains over the original value.) So the IRS's proposed change is double counting the RSUs.
    – DavidC
    Commented Oct 6, 2020 at 23:51

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From what I understand basis calculation on RSUs is the taxpayer's responsibility due to the non-standard reporting on W-2. Errors happen.

As your case seems to be an incorrect basis valuation, I would fill an amended return. Ideally when you got your initial notice you would have reviewed the numbers and filled a correction then.

You'll probably will have to document the correct basis valuation. The IRS is only interested in getting the taxes it is owed according to the tax code. You do have 3 years from when you originally filed or 2 years after when you paid the tax, whichever is later.

Depending on tax amount and time needed to prepare and file paperwork you may wish to have an accountant to assist.

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    Nit: you have 3 years from (the unextended filing deadline i.e. April 15 OR when you actually filed if after the deadline) OR 2 years from (when you actually paid). It sounds like the distinction doesn't matter for this OP, but in some cases it does. FWIW IRS finally, a few months ago, announced they will accept 1040X electronically -- but I haven't looked if consumer software supports it yet.
    – dave_thompson_085
    Commented Oct 7, 2020 at 9:04

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