Should I amend previous years' returns?

Q: I overstated expenses on my schedule E for the last 10 years due to lack of knowledge. IRS never questioned any of them. If I do my return properly this year, Do I need to amend the previous years? Thanks —Robert, Boston

The following answer was provided by Mark Misselbeck, CPA, Levine Katz Nannis & Solomon PC, Needham.

A: Regardless of how you prepare this year's return, each year stands on its own and your prior years are wrong. Your obligation is to correct the returns with Forms 1040X (CA-6 for MA) for mistakes in prior years that are open under the statute. If you timely filed earlier returns, the 2000 tax return is open for your to amend (or the IRS to assess a tax) under normal circumstances, until April 15, 2004. 2001 is open for another year beyond that, and 2002 for a second year. There are provisions for longer terms for assessments, but it does not appear that those would be applicable, here, assuming that these were honest mistakes and you can convince the IRS of that fact.