The overpayment that wasn't

[Kea]

Client got a Ltr 1687C asking what they should do with an $800 overpayment. They called the phone number on the letter and went over the return line-by-line with the IRS operator. The difference was that the printed return showed the 2nd 1/2 of the Traditional to Roth conversion (from 2010) and the electronic version that IRS received did not. The IRS officer said they would mail a check to the client while they determined which version was correct. Then the clients contacted me to find out what happened.

(Full disclosure - I would like to blame the software for this error, but there is a possibility that I may have inadvertently deleted the 8606 when "cleaning up" the return. TaxWise showed it as an unused form. I can't imagine that I would not have realized that an 8606 was supposed to be there, but at this point I can't prove I didn't delete it.)

I have created the amendment. But my questions are:
Where does it get mailed (there was no address on the Letter, just the phone number)? I am assuming it should go to the same area where the overpayment letter was generated. And that the voided check should be returned with it.

What else should be included with the amendment besides the canceled check? The Ltr 1687C? The 8606 from 2010 showing the amount to be included in 2012? A cover letter?

Thanks

[JohnH]

For an $800 refund amount I'd tell the client to deposit the check and pay the $800 with the 1040x. The small amount of interest they will pay will be a pittance compared to the hassles they will have if IRS mis-handles the void check. If the client balked at that I'd tell them to give me the interest bill and I'd pay it. In the long run that will be cheaper than the potential wasted time.

Here's how to find the address:

http://www.irs.gov/uac/Where-to-File-Tax-Returns---Addresses-Listed-by-Return-Type

[Kea]

Thanks John - sounds like good advice. (I knew where to send amendments in general. I had only wanted to know if there was a way to address this back to the letter.)

So if sent like a "normal" amendment, should I include the letter?

[JohnH]

I think I'd include the 8606 and a copy of the adjustment letter. No cover letter needed. I'd use the explanation section of the 1040X to tie it all together, probably by simply stating that "The second required payment of taxes due for a 2010 IRA conversion was missing from the original 2012 return as filed. This amended return corrects that omission. Additional tax due of $800 is enclosed herewith." (or something to that effect).

By simply stating that it "was missing", you avoid trying to offer various speculations about the omission and you have given them all the info they need to make the adjustment.

[jainen]

>>Where does it get mailed (there was no address on the Letter, just the phone number)?<<

Follow the Instructions for Form 1040X, page 5. By the way, I think that is an odd letter to have received. 1687C usually means they don't know who the refund belongs to, not what it is for. And no return address, really?

[David1980]

Form 8606 is required for the 2nd half of the conversion?

[JohnH]

Not required with the 2012 return, but I'd include a copy of the 2010 Form 8606, just to give them something to look at. If the reviewer happened not to understand the issue, maybe that would prompt them to ask someone for help.

[Kea]

Thanks to everybody!