I got a new client who invested capital gains in QOF in 2019. Here's what his old preparer did:
2019 original tax return - Form 8997 was not filed
2019 amended tax return - the return was amended to include F 8997, defer capital gain and claim a refund. IRS rejected the amended return because some forms were missing (AMT and others). I will be resubmitting the 1040X with all the forms and will include F 8997
2020 tax return - Form 8997 was not filed. Should it be amended just to include form 8997?
2021 original return filed on 10/15/2022 - Form 8997 was not filed
2021 amended return - it was amended for FATCA reporting. Form 8997 was not filed. The amended return was only mailed in late December, so likely hasn't been processed yet. I can pull transcripts to verify. If it wasn't, I guess a 1040X can be efiled and the mailed return should be rejected when it will be processed. If it was processed, file amend the amended return? Does it make sense to go through this exercise just to include form 8997? I'm reluctant to touch it because of the FATCA issue that caused the initial amendment.
Is it better to leave 2020 & 2021 (amended) returns as is and file F 8997 for 2022?
Supposedly there's some risk the entire capital gain deferral could be disqualified according to this https://www.irs.gov/newsroom/irs-letter ... nity-funds.
But there's a good chance the statute runs out for 2020 & 2021, before the IRS takes action or sends out a notice?