Filing taxes isn’t one of the most natural things to do. Many people find it full of confusion and even stress in the process. In 2019, many people tried to have their taxes filed as fast as possible. While it is tempting to rush and complete this exhausting process, it would be necessary that you take extra precautions so that you don’t rub shoulders with the tax authorities. A single mistake could lead to increased chances of your account undergoing an Internal Revenue Service (IRS) audit.
Below are some of the tax filing mistakes that you must avoid.
Secure Yourself from Potential Tax Fraud
Every day, there are cases of Tax refunds and scams. Other tax mistakes you will read in this article need to be extra careful and minimize the chances of becoming a tax scam victim.
One of how you can avoid this is by filing your taxes early. With this approach, the scammers get little chance of getting away with your tax refund.
Error in the Social Security Number
IRS receives several thousands of returns baring wrong Social Security numbers year in year out. Some returns have no Social Security number attached at all. It’s among the most common tax mistakes in the US. Therefore, try and memorize your number.
Failing to File All of Your Income
The moment you receive tax forms from employers, the IRS is also supposed to obtain a copy of those forms. Ensure that you include all your W-2 together with 1099 forms from your bank and your investment accounts. Leaving some of your income out of your return is one way that can make the IRS suspect that you are hiding your income.
Failing to File Your Taxes
Sometimes you don’t get enough time to file your taxes because of other commitments. It’s quite understandable. However, it’s advisable to request an extension in advance whenever you feel like you will not be in a position to file it on time.
Whenever you don’t file in time and at the same time you don’t request for an extension will automatically result in extra costs the moment you are ready to file. Bear in mind; even if you file an extension, it won’t exempt you from paying any taxes you owe by April 15th. The extended duration only allows you more time to consolidate your tax information and do the filing.
Not Including Your Payment Information
If you send a check or money order using your tax return, make sure that it gets sent. Besides, see that your name and Social Security number are included. Alternatively, if you do the e-file, you can pay electronically. Electronic payments save you the risk of having your returns at the mercy of the mail carrier. Include all your payment information and the correct bank information to clear the payments.
Avoid Wrong Filing Status
Before filing your tax returns, there are many questions regarding your marital status that you must ask yourself. For example, are you single, are you married though filing your returns separately or together?
Some people find choosing the right status a bit confusing. Some complications come with picking the wrong status. Ensure that you settle for the proper status so that you don’t have to pay extra penalties.
Avoid Making Mathematical Errors
We have tax software that should help you do away with several math mistakes while filing your taxes. However, most taxpayers are still manually filing their tax returns.
Committing small errors could leave you susceptible to IRS penalties. In an event where you overstate or understate deductions, you risk overpaying your taxes. Therefore, you must double-check your filing, if possible, use tax software. It’s a cheap move that should help you avoid errors and reduce tax filing stresses.
Not Paying Attention to Your Eligible Credits and Deductions
One of the many big mistakes you can make as a taxpayer is to claim too many or too few credits and deductions. Year in year out, taxpayers try to claim tax rebates they don’t deserve. Despite that, feel free and take advantage of all tax deductions and credits you qualify to use.
Failing to Sign and Dating Your Return
A good number of taxpayers take their time and track every cent of tax deductions. That’s so commendable. However, the same taxpayers have a common mistake in sending the IRS return without signing and dating it.
Failing to do the dating and singing may not seem like a big deal to you. It is a big deal for the IRS, and they will not accept your tax returns that bear no sign and dates. Returns without a signature and date are the same as those that are unfilled at all. It’s a mistake out of ignorance and can attract IRS penalties and interest.
Confirm Your Information on Direct Deposit
There’s no point in waiting for the IRS to send you a tax refund check. The check may be deposited in your bank account directly. Therefore, take your time and ensure that you are correctly feeding your bank’s routing number together with your bank account number. Simple typos will likely have your refund sent elsewhere.
Don’t Miss The IRS Deadlines
The official tax filing deadline is April 15, 2019. In case you can’t have your information together in time, file an extension. Beware of the tax deadlines. Missing these deadlines will mean that you get a penalty and interest, which is a waste of money that could have otherwise been an avoidable cause.