It’s no overstatement to say that most of us tend to leave a lot of our financial organization and other responsibilities “to the birds” around December 20th, and continue to relax and socialize with family and friends ‘til the clock rolls around to January 1st. With all the hustle and bustle of the holidays now over, the focus needs to go back to business as usual. With tax time around just around the corner, now is the time to make sure any financial loose ends are tied up, and all of your proverbial “ducks in a row.” The best option is to hire a professional to help with tax preparation.e
Tax time can be hectic and time consuming, and all those complicated forms can get confusing if you are not a trained tax professional. If you plan on preparing your own taxes this year there are some important things to keep in mind. Mistakes can lengthen the time it takes for the IRS to process your return, and could even leave you at risk for IRS audit.
When you file your taxes this year make sure to keep these 5 tax time terrors in mind at all times to avoid any unnecessary tax preparation headaches.
Common Tax Preparation Mistakes
1. Writing Down the Wrong Social Security Number
This is probably one of the most common mistakes that people make when filling out tax forms. It is very important to check and double check that you enter your social security number, or those of any dependents or employees exactly as they appear on that person’s social security card. A social security number is like your personal tax ID, and every care should be taken to ensure that no error is made when writing or typing it onto your tax forms.
2. Misspelling Names or Addresses
This is another very common error around tax time. This is another factor that, along with your social security number, is absolutely essential for the IRS to properly review your tax return information. Your name, or the names of any other applicable individuals are entered exactly as they appear on the corresponding social security card. If you use a tax professional to prepare your return, it may be good to provide them with copies of any social security information they need file your taxes. It is also important to make sure that any addresses are written correctly on any forms or envelopes to ensure that everything gets to the proper address in a timely manner.
3. Bad Math
If you are filing a paper return, it is of the utmost importance to double check your math. Even if you think your brain is like a calculator, you should probably be using an actual calculator anyways. Your brain allows for human error. A solid state calculator, or even the app on your phone however, are built on logic circuits, and do not allow for the error. Seriously. Trust technology on this one. It may be a good idea to use the best tax preparation software on the market. That way you can safeguard yourself against any mistakes when it comes to calculating figures on your tax return.
4. Errors in figuring credits and deductions.
Take your time and read the instructions in your tax booklet carefully. Many filers make mistakes when it comes to figuring their Earned Income Tax Credit, Child and Dependent Care Credit and even the standard deduction. For example, people who are 65 years and older, or have physical disabilities are able to claim different credits and deductions than other fillers. By double checking these factors, you can make sure to get the most out of your tax return this year.
5. Wrong Bank Account Information.
If you’ve made sure to enter all of your personal information properly, double checked your calculations and deductions, and filled out your tax forms, the next step is to enter your bank account number and routing number. If you choose to use direct deposit to receive your tax return, it is extremely important to make sure you enter the numbers exactly as they appear on your statement, otherwise your money can’t be deposited in your account properly.
- Did you properly date and sign each form?
- Did you enter the proper filing status on your tax forms?
- Are there any large expenses or deductions that you can apply to your return this year?
- Would it be a better idea to contact a professional tax preparer?
Tax time can be a hectic if you don’t know the in’s & out’s of tax law. If you remember these 5 common tax preparation terrors, you can help the IRS review and process your return more quickly, and expedite your refund process.
What tips do you have for avoiding tax time filing errors? Your input could help prevent someone from facing an audit headache. Leave us a comment in the section below.