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KarenInCa
Just curious, is the IRS for sure making an exception for adoptions? Or are you assuming that, in the OPs situation the IRS is?
I have not heard that the IRS is permitting people who amend earlier returns (prior to 3 years ago) to receive any money back for those returns.
BUT, if amending those older returns allows you to claim more of a return within the most recent 3 years, then refiling those older returns is allowable.
For instance. If you adopt in 2005 and didn't do any federal adoption tax credit stuff because it would only be peanuts, and then decide that because it's refundable in 2010 that you should:
First you re-do your 2005 taxes, and find out how much you should have gotten back, and what your carryover is. You can't get that money back, because it's more than 3 years ago. Then redo your 2006 taxes, using the carryover, and figure out how much you would have gotten back and how much your new carryover is. (Still can't get that money back.) Same for 2007 - use the new carryover amount, figure out how much you would have gotten back in 2007, and whta your new carryover is - but without getting the money back.
Then you hit 2008 - redo the taxes with the new carryover amount, figure out how much you would have gotten back, andyour new carryover amount. You DO get that money back. In 2009, same thing - new carryover entered, how much you get back, and new carryover amount - you DO get that money back. In 2010, enter new carryover amount, and because it's refundable you get ALL that remaining carryover and you're finished.
You don't get any of the potential money back for the 2005-2007 years, because they are too old. But you do get the 2008 - 2010 money back, because that's within the past 3 years. But if you don't redo your 2005-2007 taxes, you would not have the correct numbers to know what to put on your 2008 taxes. Therefore, you have to redo the tax returns from the date of the adoption even though you can not receive any money back from those earlier amended returns.
Hope that helps!