5 Most Common Tax Mistakes

As tax season rolls around the vast majority of us look ahead to April 15th as the great doomsday. And instead of thinking and planning for this time of year during the other 11 months, we procrastinate, hedge and fidget until we only have a few days left. Then we scramble and try to gather all of our records and receipts together so that we can get this painful chore out of the way as quickly as we can. And, alas, we make silly mistakes that at best can cost time, and at worst can cost time and more money.

If this sounds a lot like you, take heart. You certainly aren’t alone. There are literally scores of people in the very same boat. And they make the same mistakes. But this year, and this is just a thought…don’t wait until the last minute to make that mad dash. Start now by getting just a little bit more organized. Begin to keep all of your records and receipts in one spot. And keep an eye out for these five very basic, very common, and very preventable mistakes that so many people make:

1. Missing the deadline and asking for an extension. C’mon. You’ve only been waiting for it for 364 days. Now you may have to pay late penalties as well as interest. If you have a legitimate problem you’ll need to submit Form 4868, Application for Automatic Extension of Time To File U.S. Income Tax Return by the April deadline in order to get an extension.
2. Calculation errors. They’re usually very simple, a misplaced comma or an addition or subtraction miscue. Always check and recheck. Go through the numbers patiently, and then go through them again tomorrow. Or, ask a family member or friend to double-check your figures. Consider using tax software programs; these will do the math for you.
3. Forgetting to submit all relevant forms like W-2s, 1099s, or other schedules necessary for your particular situation. Again, many tax software programs can now alleviate this problem.
4. Benefits claimed (or not claimed) pertaining to dependent children. Often if you don’t know the allowed exemptions you may fail to make a correct claim or make an incorrect one. Know who your dependents are! (chuckle)
5. Forgetting to sign and date the forms. Yep. And this mistake will keep the IRS from processing your return. Be sure to check all the pages carefully and ensure you haven’t missed anything. Another common omission is the Social Security or Tax ID number.

The IRS has modernized its systems and many of these silly mistakes can be avoided simply by filing electronically. Last year about 50% of all tax returns were done with e-filing. There are many advantages. Most software programs provide all of the necessary forms, they walk you step by step through the forms and the filing process, the electronic calculators rarely make mistakes, and you almost always get your refund much faster. For information on e-filing, available tax preparation software, or general tax questions, don’t hesitate to visit the IRS’ website.