Amending, go off transcript or letter?

[nwtaxlady]

I have a new client. She has been doing her own taxes incorrectly and got a letter last year from IRS for tax year 2013 for not reporting her rental income that her property manager issued a 1099 for Rents. So she just went along and paid the tax. She needs to amend the return to claim the property managers fees, mortgage interest, etc. and set it up on depreciation. I have a copy of her original return that she prepared and her letter that she just paid the tax on. So I had her get a transcript for tax year 2013. The transcript is exactly like her original return. It does not reflect the rental income or the tax she paid due to the IRS notice. So when I amend the return what am I using for the original amounts? Do I go off the transcript which is exactly the same as her original return? Then add that she paid additional tax of X amount? Or do I go by the IRS notice that they say that her rent income was not reported?

Thanks!!

[Lion]

You will amend the "amendment" or revised return the IRS computed. You need to get the history of her IRS account that shows the additional tax she paid, the 1099, etc. Don't know how long it takes for changes to her account to appear on e-Services.

[taxea]

The IRS transcript IS the original return. You need the income/expenses and deprecable items to amend the 2013 return and those going forward. You can use F3115 to adjust the depreciable items but there still needs to be a Sch E included for each year. I would amend each year in sequence and get them all in before the assessment filing deadline for each. Put 2016 on extension so you will have time to prepare the others. And get a retainer to cover your fees before you do any further work.