A lot of people are eager to file early in hopes of getting their tax refund sooner, but also find that after filing they may have missed some key data or gotten additional information late, like a Employer W2 or 1099-X form – that is required to be reported in their tax return.
This creates a sense of panic and worry that their tax filing will be flagged or refund held-up as the information they provided would not match what the IRS has from one or more of their employers or financial institutions that send W2, 1099 and other tax filing forms.
But there is no need to stress as the issue may get resolved automatically by the IRS or you can simply file an amended return to fix the issue.
While I still recommend waiting until early February to file, as most tax forms or notices of delay are required to be sent by employers and institutions by this date, filing an amended return (Form 1040-X) via tax filing software or your preparer is relatively straight forward nowadays.
However, before you amend your return, be it for missing W2s or other minor errors, you may still want to wait for the IRS to complete processing of your initial tax filing submission.
This is because the IRS can and often does automatically fix or correct missing, incorrect or improperly reconciling information on your tax return based on the information they have from employers, financial institutions and other agencies that are required to report payments or income to the agency.
This includes information from W-2 or various 1099 forms. If they are able to fix or reconcile the issue, they will do so and send you a notice explaining the issues and their resolution. You will have a chance to appeal and file an amended return at this stage.
If you don’t wait and immediately file an amended return, it could confuse things with the IRS and further delay your amended return refund. So unless a major miss or large credit is missing, I recommend waiting for the IRS to complete initial processing and then to only take action after getting notified by them.
If they reject your return, because of missing information or filing issues, you can also amend at that point and correct or provided updated details.
You can also now submit amended returns online (since 2019) with updated information via your tax filing software or tax preparer. You don’t have to attach or submit the actual W2 or 1099, just the information provided in there which impacts your tax liability or refund.
The above also explains why trying to purposely hide W2s or 1099, which generally shows earnings or income received (and hence more taxes) is not likely to work and subject you to further IRS actions like an audit.
In todays electronic world, the IRS has data from most W2 and 1099’s loaded into their systems, which is why they can resolve many issues directly off the filing. However this also gives them the capability to systemically identify filing gaps, deliberate or not.
I have also seen comments online saying that they tax payers can submit any unfiled or missing W2’s in the following year. This is incorrect. You need to report income earned and pay taxes for the year it was incurred.
If you get a W2 or 1099 forms (for freelance or gig worker income) several months later, then you need to amend the return for the year in which you earned that income.
The same approach and guidance in this article is also recommended for amending information in state income tax return filings.