The CARES Act contains robust tax provisions effective for years 2018, 2019, and 2020, including those that allow taxpayers to take advantage of specific expensing rules for the affected years. How can you maximize those provisions for your business? There are many options to consider, and you may be wondering how you can maximize your advantage for 2018 or 2019. In our last post, we outlined the major points of those provisions; today we’re looking at amended versus superseded returns and how to know which is the right move for you.

Timing is Everything

When you think about making changes to a previously filed tax return, you might assume it involves amending a tax return – but that’s not necessarily the case.  If you have not reached the due date (or extended due date if you filed an extension), you may be able to file a superseding tax return instead.

There are several advantages to filing a superseding return. First, it return can make changing a previously-filed return a lot less complicated as it’s essentially the same as filing the original return, which means you can correct for missed elections, fix mistakes, or take advantage of a new tax law such as those provided in the CARES Act.

Easing the Way for Partnerships

In a partnership, filing a superseding tax return is the easiest way to make changes, due to the new requirements for partnerships subject to the partnership audit rules effective for tax years ending after December 31, 2017, (i.e., 2018 on.)

Amending a return that’s subject to the new partnership audit rules involves more forms and more complexity, so in many cases it’s not the preferred option.  However, the IRS has given us a bit of reprieve on using the new forms for now, and instead are allowing the use of some of the old forms – but only temporarily.

When You Must File an Amended Return

If you want to make changes to a tax return whose due date has passed, you will be stuck filing an amended return.  Entity-level amended returns can generally be e-filed, though individual amended returns require a paper filing.  The IRS says that it can take up to 16 weeks to process an amended return, but since they just recently resumed processing paper returns – meaning that the processing period could be considerably longer for any recently-submitted amended returns.

The Way Forward

Whether you’re filing an amended or superseded return, make sure you’re taking maximum advantage of the tax provisions in the CARES Act. Our Barnes Dennig tax experts can provide the insight and expertise you may need – contact us to find out how we can help.

Additional Resources

Visit Barnes Dennig’s COVID-19 Resource Center for a comprehensive list of resources. Please contact our COVID-19 Advisory Team or any of our leadership team at Barnes Dennig to discuss.

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