Error in tax return

Q

There’s an error in the federal tax return I filed. How can I correct it?

— C.R., Flint, Michigan

A

The 1040 form you file isn’t the only one you can file for each year. You can file an amended return with a 1040X form, and you can even amend an amended return later!

Mistakes involving your filing status, income, deductions or credits will require an amended return. One way to reduce the need for an amended return is to use tax-prep software such as TaxACT or TurboTax. Such software can reduce errors, since it will do calculations for you and will help you be thorough, submitting all needed forms and schedules.

Q

Are stocks too risky for teenagers?

— T.L., Walnut Creek

A

Not at all! As long as they’re investing for the long term, young people stand to do the best investing in stocks.

For example, if you’re 15 and you invest $1,000 in the stock market each year and earn an average annual return of 8 percent, you’ll end up with almost $50,000 when you’re 35 and about $280,000 by age 55. Of course, you’ll be able to invest more as you get older — amassing more money that can help you buy a home or retire early. People in or near retirement have far less time in which their money can grow.

Short-term money — money needed within five or even 10 years, perhaps for college -- should be in “safer” places than stocks, such as money market accounts or CDs. Teens can learn much more in “The Motley Fool Investment Guide for Teens” by David and Tom Gardner with Selena Maranjian (Touchstone, $16).