Did you know that the average person spends approximately 12 hours preparing their income tax return? Have you started gathering all your information to prepare your 2018 return? Remember, if you spend all that time preparing your return, the last thing you want to do is make a mistake because you are in a rush. Errors, no matter how simple, can delay your refund. Here are some common tax filing mistakes and what you can do to avoid them.
Get organized: If you don’t have your tax information together yet, you better start now. Missing information can have the potential to cost you unnecessary funds.
Wrong Social Security number or wrong identification: The social security number must match what is on your Social Security card because the IRS compares all returns against the Social Security Administration database. Plus, it’s easy to focus on the numbers that forget to sign your return or even enter other necessary information. Even having the wrong name can be a problem. These problems often occur after marriage or divorce, especially if you have not reported Social Security.
Filing Marital Status Errors: There are five filing marital status options (single, married filing jointly, married filing separately, head of household, and qualified widow with dependent) that they are used to determine your filing requirements (standard deduction, credit eligibility, deductions, and your correct tax. Choosing the best filing status for you is one of the initial steps in filing your return.
Math Errors and Calculation Errors – With all those numbers you can enter on your tax forms, it’s easy to make simple math mistakes. If the IRS finds those errors, it can recalculate them for you, but not for your benefit. Therefore, it would be beneficial for you to check your math before submitting your forms. In addition to possible mathematical errors, there may be calculation errors related to taxable income, withholdings, estimated tax payments, and miscellaneous. tax credits.
Incorrect bank account numbers for direct deposit: It is important to verify your bank routing number and your account number to ensure you receive your refund in a timely manner. Just as important is paying your taxes on time to avoid potential penalties and interest.
Unreported Income – Don’t forget to add income from anything other than your workplace. This includes interest income, savings dividends, rental income, or funds from a second job. Be sure to add up all of your income statements (W-2, 1099, K-1, and 1098). Remember, the IRS gets copies of all of those forms, too.
Filing late or even no filing – Many of us can get overwhelmed with details and postpone filing our returns on time or not filing at all. Sooner or later, the IRS will discover your lateness and you will receive a bill for interest and penalties for not following the rules. If you can’t meet the April 15 deadline, you can request a six-month extension and avoid these penalties by paying taxes due before the filing deadline.
Start saving: Whether you owe the IRS or are waiting for a refund, it’s always good to be saving. Sometimes refunds are delayed so you cannot delay your invoices waiting for your refund. Be sure to set aside a portion of your income now so that you are prepared to pay for any unexpected payments.
Use your return wisely – If you expect a return this year, be sure to use it wisely. Before you spend it, make sure you prioritize your financial needs and target the rebate for that.
My advice to you: be sure to prepare your tax return when you have the fewest detours. If you get interrupted or have annoying distractions, stop what you’re doing and finish your return later. A little extra time spent on your tax return will go a long way toward submitting an accurate return. By following these simple tips, you can ensure that you will not receive a letter from Uncle Sam informing you that you owe extra money.