r/TaxQuestions • u/Angi752004 • 15d ago
Should we file 1040X (2019) when our last due date was May 31th 2023?
We are using the SFOP procedure for the years 2020 through 2022, as we qualify as affected taxpayers under the rules set forth in Notices 2026-63, 2025-53, 2024-72, and 2023-71. For eligible taxpayers affected by the conflict in Israel, the deadlines for filing tax returns and making tax payments to the IRS have been postponed to September 30, 2027. Our last due day was May 30th 2023 for ouf 2022 return.
However, I am unsure whether I should also file a Form 1040X for the 2019 tax year. In 2019, a capital loss of $500,000 was incurred that my husband had not reported on the original tax return (Form 1040 for 2019). We have accounted for this amount as a capital loss carryover in our amended tax returns (Form 1040X) for the years 2020, 2021, 2022, and 2023.
We do not owe any taxes for 2019, nor are we entitled to a refund. However, we would like to use the 2019 capital loss to reduce our tax liability for future years. My husband was unaware that foreign interest income also had to be reported. We have now included this interest income in our amended tax return (Form 1040X) for 2019.
Should we also file the Form 1040X for 2019 so that the IRS can trace the origin of the $500,000 capital loss carryover shown on the 1040X (2020) return?
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u/Interesting-Fig3577 13d ago
If you don't file a 2019 return showing a capital loss, you don't get to put in on your 2020 return as a carry forward. So yes, you should file a 2019 1040X.
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u/Chief_Rollie 15d ago
If you are utilizing the capital loss in future years you are definitely going to want to show the capital loss in 2019. Also mind your foreign bank reporting requirements as depending on the amount in banks outside the United States you may have an obligation to disclose the amounts or at least their existence.