2023 Form IL-1040-X Instructions

You should file Form IL-1040-X, Amended Individual Income Tax Return, if you need to change a previously filed Form IL-1040, Individual Income Tax Return, due to a change that affects items used to figure your Illinois net income or credits.

Your change can occur from a state change or a federal change, i.e.,

• an amendment of your federal income tax return,
• an adjustment made by the Internal Revenue Service (IRS), or
• any other recomputation or redetermination.

You should file Form IL-1040-X only after you have filed a processable Illinois Income Tax return. You must file a separate Form IL-1040-X for each tax year you wish to change. Do not file another Form IL-1040 with “amended” figures to change your originally filed Form IL-1040.

To amend, use the Form IL-1040-X for the year you are amending. If you are amending your Form IL-1040 for 2007 or earlier, you must use the 10/08 revision of Form IL-1040-X (for 2007 and earlier tax years).

The amount of time you have to amend your return depends on whether your Form IL-1040-X is being filed due to a state change or a federal change.

State change only – If your change decreases the tax due to Illinois and you want a refund, you must file an amended return (claim for refund) within

• three years after the extended due date,
• three years after the date your original return was filed, or
• one year after the date your Illinois tax was paid,

whichever is latest.

Federal change (including NOLs and net section 1256 contracts losses) – If your federal change decreases your Illinois tax, and you want a refund, you must file an amended return (claim for refund) within two years plus 120 days of federal finalization.

In general, Illinois allows you to take the same NOL carryback or carryforward deduction or net IRS section 1256 contracts loss carryback allowed on your federal income tax return. A carryback deduction is a “federal change” that reduces your federal adjusted gross income (AGI) on Step 2, Line 1. For either an NOL or net IRS section 1256 contract loss carryback, check the box marked “NOL” on Step 1, Line F, and indicate the date the IRS accepted your carryback deduction. This will usually be the date on which the IRS issued your refund check. You must file Form IL-1040-X within 2 years plus 120 days after that date to be eligible to receive a refund.

Illinois does not allow you to deduct the same NOL twice. To prevent a double deduction of your NOL when you have any NOL remaining to carry to a later year, your deduction for a tax year cannot be greater than the federal NOL available for deduction in that year minus the federal NOL available to carry to later years. This is the lesser of the loss available in the year or the amount reported as “modified taxable income” on federal Form 1045, Application for Tentative Refund, Schedule B, Line 9.

For an NOL carryback, attach a copy of your federal Form 1045 Schedule B.

If you are a resident in the year you are allowed a federal NOL deduction, Illinois allows you to deduct the entire amount even if you were not a resident in the year the loss occurred. If you are a nonresident or part-year resident in the year you are allowed the federal NOL deduction, see the instructions for Step 3, Line 19, of Illinois Schedule NR, Nonresident and Part-Year Resident Computation of Illinois Tax.

Example: In tax year 2023, Paul Taxpayer, a nonresident individual, has $20,000 in federal net losses from Partnership A and $180,000 in net losses from Partnership B. He has $100,000 in income from other sources, so his AGI for 2023 is a net operating loss of $100,000. Federally, Paul Taxpayer carries the entire $100,000 loss back to 2021.

Ten percent of the $100,000 net operating loss deduction for 2021 is attributable to Partnership A (Partnership A’s $20,000 loss in 2023 is divided by the $200,000 in total losses incurred from partnerships in 2023) and 90 percent of the net operating loss deduction is attributable to Partnership B. See the Schedule NR Instructions for Step 3, Line 19, to determine the amount of each partnership’s net operating loss deduction amount that is allocated or apportioned to Illinois.

For a net IRS section 1256 contracts loss carryback, your deduction for a tax year cannot be greater than the loss amount on Line 1 of the US 6781 for the carryback year, and the allowable loss amount cannot be greater than the gain listed on Line 1 of US 6781 for the carryback year. For a net section 1256 contracts loss carryback, attach a copy of your federal Form 6781, Gains and Losses From Section 1256 Contracts and Straddles for the carryback year.

In order to support a refund claimed as a result of a finalized federal NOL or IRS net section 1256 contracts loss carryback, you must attach the following information:

• a copy of your federal Form 1040X, Amended U.S. Individual Income Tax Return, or federal Form 1045, and
• a copy of any refund check and any other notification you received from the IRS indicating acceptance of the changes shown on your federal Form 1040X or federal Form 1045, and
• a copy of your federal Form 1045 Schedule B for an NOL carryback (or pro forma if this was not filed federally), or
• a copy of your federal Form 6781 for a IRS net section 1256 contracts loss carryback.

If you fail to attach the required information to your Form IL-1040-X, your refund may be delayed or denied.

You may generally claim a $2,425 exemption for yourself and each of your dependents. The additional exemption allowance for taxpayers and their spouses who are 65 years of age or older or who are legally blind is $1,000. See the Form IL-1040 Instructions for details.

If you are filing Form IL-1040-X because

• you filed a federal Form 1040X to report a federal change other than an NOL carryback, you must include a copy of that form and proof of federal finalization.
  If your federal change resulted in an overpayment, proof of federal finalization includes a copy of the notification you received from the IRS stating that they accepted the changes shown on your federal Form 1040X; e.g., a refund check, “Statement of Account,” agreement, or judgment.
  If your federal change resulted in a balance due, proof of federal finalization includes a copy of your federal Form 1040X and a copy of the check you sent to the IRS to pay the tax due.
  If you do not have a copy of this notification, please contact the IRS to request a tax account transcript.
• of a change made by the IRS, you must include copies of all the federal examining officer’s reports, including preliminary, revised, corrected, and superseding reports.
• of any other changes, see the instructions for Form IL-1040 and any schedules to see what to attach.

If we deny your refund claim by a written notice of denial, you may file a written protest within 60 days and request a hearing. If you do not hear from us within six months after you have filed your claim, you may file a written protest at any time and request a hearing.

If you need additional forms or schedules,

• visit our website at tax.illinois.gov or
• write to us at
  ILLINOIS DEPARTMENT OF REVENUE
  PO BOX 19010
  SPRINGFIELD IL 62794-9010

• Visit our website at tax.illinois.gov for assistance, forms or schedules.
  
• Write us at:
  ILLINOIS DEPARTMENT OF REVENUE
  PO BOX 19001
  SPRINGFIELD IL 62794-9001
• Call 1 800 732-8866 or 217 782-3336 (TTY at 1 800 544-5304).
• Visit a taxpayer assistance office - 8:00 a.m. to 5:00 p.m. (Springfield office) and 8:30 a.m. to 5:00 p.m. (all other offices), Monday through Friday.

Line A – Enter your name(s), year(s) of birth, Social Security number(s), current address, and email address. Include your Illinois county if you were an Illinois resident during the year.

Line B – Check the box if your Social Security number(s), name(s), or address are different on this return than on any previously filed return. If your Social Security number is different on this return, include the Social Security number from your previously filed return in Line I.

Line C – Check the box to indicate your filing status. If your filing status is different from your previously filed return, explain your change in Step 11, Line D.

In general, most taxpayers should use the same filing status as on their federal return. However,

• if you are married, you filed a joint federal return, and you are an injured spouse (your spouse owes a liability, for which you are not responsible, to a government agency), you should file separate Illinois returns using the “married filing separately” filing status. If you choose to file a joint Illinois return, we may take the entire refund to pay your spouse’s liability.
  Note: If you did not make this election on your original Form IL-1040, you may file Form IL-1040-X to make this election only if the extended due date of the return has not passed. If you made this election on your original Form IL-1040, you may file Form IL-1040-X to revoke this election only if the extended due date of the return has not passed. Once the election is made and the extended due date has passed, it is irrevocable for the tax year. Do not recalculate any items on your federal return. Instead, you must divide each item of income and deduction shown on your joint federal return between your separate Illinois returns following the Allocation Worksheet in the Form IL-1040 Instructions.
• if either you or your spouse is an Illinois resident and the other is a part-year resident or nonresident (e.g., military personnel), and you elect to file a joint return, you will both be treated as residents. If you originally filed a joint return, but did not treat both yourself and your spouse as Illinois residents, you must correct that error by either filing a joint Form IL-1040-X treating yourselves as Illinois residents or by filing separate IL-1040-X forms, even if the extended due date has passed. If you file separate IL-1040-X forms, do not recalculate any items on your federal return. Instead, you must divide each item of income and deduction shown on your joint federal return between your separate Illinois returns following the Allocation Worksheet in the Form IL-1040 Instructions. Any spouse filing as a nonresident or part-year resident must also attach a completed Schedule NR.

Line D – Check the corresponding box if someone else can claim you or your spouse as a dependent.

Line E – Check the corresponding box if you or your spouse were a nonresident or part-year resident of Illinois.

If you filed Schedule CR, Schedule NR, Schedule ICR, or Schedule IL-E/EIC, with your original Form IL-1040 or previously filed Form IL-1040-X, you must complete and attach corrected schedules to your Form IL-1040-X. For each change you make, you must provide an explanation in Step 11, Line D.

Line 1 – If your AGI is changing due to a federal change, you must attach proof of federal finalization.

Line 2 – If you are changing the amount on this line, see the Form IL-1040 Instructions.

Line 3 – You must provide an explanation in Step 11, Line D, if this is a change to your previously filed return.

Complete Schedule M, Other Additions and Subtractions for Individuals, and enter the total addition amount from Schedule M.

Any changes that you make to the subtractions on Lines 5 through 7 require corrected support for that line. You must also provide an explanation in Step 11, Line D, if this is a change to your previously filed return.

Line 5 – Enter the corrected amount of federally taxed Social Security and retirement income included in your AGI on Line 1 of your Form IL-1040-X. Attach federal Form 1040 or 1040-SR, Page 1 with amended figures and any W-2 and 1099 forms.

Line 6 – Enter the corrected amount of any Illinois Income Tax overpayment reported as income on your federal Form 1040 or 1040-SR, Schedule 1, Line 1. Do not include other states’ refunds on this line. Attach federal Form 1040 or 1040-SR, Page 1, and Schedule 1 with amended figures.

Line 7 – If you claimed other subtractions from Schedule M on your previously filed return or if you are filing Form IL-1040-X because you qualified for a subtraction but did not previously claim it, you must correct or complete Schedule M and attach it to your Form IL-1040-X.

Lines 8 and 9 – Follow the instructions on the form.

Income Exceptions

• If your federal filing status is married filing jointly and your federal AGI is greater than $500,000, you are not entitled to an exemption allowance on Line 10. Enter “zero” on Line 10.
• If your federal filing status is single, head of household, married filing separately, or widowed and your federal AGI on Line 1 is greater than $250,000, you are not entitled to an exemption allowance on Line 10. Enter “zero” on Line 10.

Line 10a – See chart to figure your exemption amount for this line.

*Single filing status includes Head of Household, Widowed, and Married filing separately.
**See Income Exceptions.

Line 10b – If you (or your spouse if married filing jointly) were 65 or older, enter the total number of exemptions, as corrected.

Line 10c – If you (or your spouse if married filing jointly) were legally blind, enter the total number of exemptions, as corrected.

Line 10d – If you are claiming dependents, complete Schedule IL-E/EIC, and enter the amount from Step 2, Line 1, on Line 10d, as corrected. Attach: Schedule IL-E/EIC.

If you change the number of your exemptions, you must explain the reason, in detail, in Step 11, Line D.

If you are changing Line 10 due to a federal change, you must attach proof of federal finalization. Attach a copy of your original federal return or amended federal Form 1040X that supports the exemption change.

Line 11 – Residents: Figure your net income by subtracting Line 10 from Line 9, and enter the result. This line may not be less than zero.

Nonresidents and part-year residents: First, check the box in Step 1, Line E, to identify whether you were a nonresident or a part-year resident of Illinois during 2023.

Next, enter the amount from Schedule NR, Line 51, on Line 11. This line may not be less than zero.

Line 12 – Residents: Multiply your net income on Line 11 by 4.95% (.0495).

Nonresidents and part-year residents: Enter the corrected tax from Schedule NR, Step 5, Line 52.

Line 13 – If you are recapturing investment credits, enter the amount from Schedule 4255, Recapture of Investment Tax Credits. Attach Schedule 4255 with amended figures.

Line 14 – Follow the instructions on the form. Cannot be less than zero.

Line 15 – If you claimed a credit for tax paid to other states on your previously filed return or if you are filing Form IL-1040-X because you qualified for this credit but did not previously claim it, you must correct or complete Schedule CR.

Line 16 – If you claimed a property tax credit, a K-12 education expense credit, or a volunteer emergency worker credit from Schedule ICR on your previously filed return, or if you are filing Form IL-1040-X because you qualified for the credit but did not previously claim it, you must correct or complete Schedule ICR.

Line 17 – If you claimed a credit from Schedule 1299-C, Income Tax Subtractions and Credits (for individuals), on your previously filed return or if you are filing Form IL-1040-X because you qualified for this credit but did not previously claim it, you must correct or complete Schedule 1299-C.

Lines 18 and 19 – Follow the instructions on the form.

Line 20 – If you are changing the amount on this line, see the Form IL-1040 Instructions.

Line 21 – Enter the amount of Illinois Use Tax you reported on your Form IL-1040.

Line 22 – If you are changing the amount on this line, see the Form IL-1040 Instructions.

Line 23 and 24 – Follow the instructions on the form.

Line 25 – If the amount of your Illinois Income Tax withheld changes from your previously filed return, complete a corrected Schedule IL-WIT.

Line 26 – Enter the total of estimated tax payments you made with Form IL-1040-ES, payments made with Form IL-505-I, and any overpayment applied to your 2023 estimated tax from a prior year return.

Line 27 – Enter the amount of pass-through withholding (income tax paid) made on your behalf by a partnership, S corporation, or trust.

Line 28 – Enter the total share of pass-through entity tax credit passed through to you shown on Schedule K-1-P or Schedule K-1-T for this tax year.

Line 29 – If you claimed an Earned Income Credit (EIC) on your previously filed return or if you are filing Form IL-1040-X because you qualified for this credit but did not previously claim it, you must correct or complete Schedule IL-E/EIC and attach it to your Form IL-1040-X. If you are changing Line 29 due to a federal change, you must attach proof of federal finalization.

Line 30 – If you made tax payments with your Form IL-1040, a previously filed Form IL-1040-X, or for any other reason (i.e., paying your electronic return balance due, responding to a notice or a bill, or an amount was collected from you), enter the total of all tax payments made. Do not include any penalty or interest you paid.

Line 31 – Follow the instructions on the form.

Lines 32 and 33 – Follow the instructions on the form.

Line 34 – Enter the overpayment, if any, from your original Form IL-1040, Line 31, or the adjusted overpayment amount reported to you by the department.

Line 35 – Follow the instructions on the form.

Line 36 – Enter the amount from Line 35 you want refunded to you and check the box for how you would like to receive your refund. We will figure any interest due to you and include it in your refund.

Line 37 – Subtract Line 36 from Line 35. This is the amount of overpayment you elect to be applied against your estimated tax obligation.

If you elect to apply your overpayment against your estimated tax obligation, see Form IL-1040 Instructions for more information.

If your overpayment accrues interest and you elect to

• apply your entire overpayment against your estimated tax, any interest you accrue will also be applied against your estimated tax. We will calculate the amount of interest and notify you.
• receive a portion of your overpayment as a refund and apply the remainder of your overpayment against your estimated tax, any interest you accrue will be included with your refund.

Line 38 – If you have an amount on Line 32 and this amount is less than Line 34, subtract Line 32 from Line 34 or if you have an amount on Line 33, add Lines 33 and 34. This is the amount of tax you owe.

We encourage you to pay electronically using MyTax Illinois. If you do not elect to pay electronically, complete the 2023 IL-1040-X-V, Payment Voucher for Amended Individual Income Tax, and staple it, along with your payment, to the front of your Form IL-1040-X.

We will figure the amount of any penalties and interest you owe, and send you a bill for any amount due. However, if you prefer, you may figure the penalties and interest you owe yourself. For more information, see Publication 103, Penalties and Interest for Illinois Taxes, on our website at tax.illinois.gov.

The following penalties must be paid unless you can show that the failure to timely file or pay is due to reasonable cause and not due to willful neglect.

You may owe

• a late-filing penalty if you do not file a processable return by the extended due date.
  Note: Changes resulting from a net operating loss (NOL), net section 1256 contracts loss, or capital loss carryback will not affect this penalty.
• a late-payment penalty for unpaid tax if you do not pay the tax you owe on time.
  Note: If you file an amended return before the extended due date, this penalty will be adjusted based on the newly reported tax. Also, tax required to be shown on the return that was not previously reported is subject to this penalty if not paid by the original due date of the return. Changes resulting from a net operating loss (NOL), net section 1256 contracts loss, or capital loss carryback will not affect this penalty.
  Note: If you are filing to report a federal change, this penalty will not be assessed if you file Form IL-1040-X and pay the tax you owe within 120 days of the federal acceptance date shown in Step 1, Line F.
• a late-payment penalty for underpayment of estimated tax if you were required to make estimated tax payments and failed to do so, or failed to pay the required amount by the payment due date.
  Note: If you file an amended return before the extended due date, this penalty will be adjusted based on the newly reported tax. In most cases, if you file an amended return after the extended due date, any penalty for late payment of estimated tax will remain as originally assessed.
• a bad check penalty if your remittance is not honored by your financial institution.
• a cost of collection fee if you do not pay the amount you owe within 30 days of the date printed on any bill we send you.
• interest on unpaid tax from the day after the original due date of your return through the date you pay the tax.
  Note: If you received interest on the refund from your original Form IL-1040 or a previously filed amended return and you file an amended return that either reduces the original refund amount or results in a balance due, you must pay back the interest on the portion of the refund that you received in error.

Line A – Check the box that describes your change. The date needed for

• federal changes that resulted in an overpayment is the date you received a federal finalization notice from the IRS stating that they have accepted your change either by paying a refund or by final assessment, agreement, or judgment, not the date you filed your federal Form 1040X.
• federal changes that resulted in a tax increase is the date you filed your federal Form 1040X and paid the tax due. Failure to provide this date could result in an assessment of a late payment penalty.

Lines B through D – Follow the instructions on the form. If you file Form IL-1040-X, Lines B through D must be completed. Failure to complete these lines may result in a delay in the processing of your return.

You, and your spouse if filing jointly, must sign and date your return. If you are filing for a minor as a parent or guardian, you must sign the return. Staple all required copies of forms and schedules, powers of attorney, and letters of estate or office to the back of the return.

If you pay someone to prepare your return, the paid preparer must also sign and date your return, provide a phone number, and enter their Preparer Tax Identification Number (PTIN) issued by the IRS. Check the box if the paid preparer is self-employed. If the paid preparer is employed with a professional tax preparation firm, the paid preparer also must provide the name, the Federal Employer Identification Number (FEIN), the address, and phone number of the firm.

If you want to allow another person to discuss this return and any previous return that affects the liability reported on this return with us, check the box and print the designee’s name and telephone number. The authorization will allow your designee to answer any questions that arise during the processing of your return, call us with questions about your return, and receive or respond to notices we send. You may revoke the authorization at any time by calling or writing us.

Mail your return to: