In the world of trading and taxes, it's not uncommon to receive a corrected tax form. What can cause a correction? In short, any material changes such as revisions to an acquired or disposal date, a revised dollar amount to any field, or an addition/omission of a transaction. On most occasions in a non-retirement account, if there was a change to an acquired or disposal date, it should not change your overall profit or loss for short-term or long-term gains unless it reclassifies from short-term to long-term, or vice-versa). When a correction gets issued, the IRS will also receive the corrected information.
How can I tell if there was a correction?
Corrected Consolidated 1099
You can quickly determine if your Consolidated 1099 had a correction by referring to the document header on page 1 above the Tax Reporting Statement, as illustrated below. Furthermore, you can quickly spot what got affected by referring to any "C" listed alongside any corrected line items. If there was a change in your total gain or loss and you already filed, then you may consider amending your taxes with IRS Form 1040X. To learn more about amending your taxes, please visit the IRS information site by clicking here.
Example of the correction label on a Consolidated 1099
Corrected IRA Tax Forms
You can quickly determine if your Form 1099-R or Form 5498 was corrected by referring to the recipient name and address section. A correction label will list beneath the Statement Date, as illustrated below. You can quickly spot what got affected by referring to any "C" listed alongside any corrected line items.
Example of the correction label on a Form 5498
What if I had already filed my taxes?
Material changes may require an amendment
Tax software data (OFX file) and tax worksheet (CSV) hosted in the Tax Center will update 72-hours after a correction is issued.