Preparing to file your federal income taxes can feel overwhelming, but with some careful attention to detail, you can avoid many common tax filing mistakes that could lead to penalties, missed opportunities, delayed refunds, or even an audit. Use these tax filing tips to keep the process error free.
Check for oversights and simple mistakes. Always review your IRS forms several times to catch these simple tax filing errors:
- Outdated tax forms: Be sure to use the correct forms for the current tax year.
- Names that don’t match Social Security cards: Double-check to ensure that the names on your tax return exactly match those on your family’s Social Security cards.
- Missing or inaccurate Social Security numbers: Verify that the numbers on your tax return match those on your family’s Social Security cards. If you are using a Taxpayer Identification Number (TIN), make sure it’s correct.
- Missing or incorrect filing status: Be sure to choose the accurate filing status box since the status impacts your tax rate, deductions, and eligibility for credits. If you’re unsure, use the IRS’s Interactive Tax Assistant tool or reliable tax preparation software.
- Missing signatures: Don’t forget to sign and date your tax form. For joint returns, both spouses must sign.
- Mistakes in bank account numbers: If you’re requesting direct deposit for your refund, ensure that your bank’s routing and account numbers are correct.
File your returns at the right time. Timing is key when filing your taxes.
- Don’t file too early: Wait to file until you have received all your necessary documents, such as your W-2s, 1099s, and other important forms.
- Don’t file too late: Always file by the Tax Day deadline (usually April 15) to avoid penalties, interest, or legal consequences—especially if you owe taxes.
- File an extension: If you need more time, you can request a filing extension. However, remember that the extension postpones the filing deadline, not the payment deadline, which is still due by Tax Day to avoid penalties.
Perform your due diligence. Shortcuts and guesswork can be costly. Here’s how to maximize your refund and minimize your tax liability.
- Report all income: Every dollar matters. Be sure to report all sources of income, whether from a full-time job, freelance work, side gigs, or investments. Failing to do so can lead to penalties and interest later on.
- Maintain accurate records: Keep detailed records of your income, expenses, and receipts for any deductions you claim. This will not only boost your tax compliance but also significantly reduce your stress at tax time!
- Check for math mistakes: Even simple errors in addition or subtraction can cost you. Tax preparation software helps with calculations, but it’s always a good idea to verify your work before submission.
- Get help calculating credits and deductions: Tax preparation software can help ensure you claim all eligible credits—like the Earned Income Tax Credit or Child Tax Credit—but always double-check the information you enter to avoid errors.
Get help. The laws are complicated, so don’t hesitate to get assistance.
- Get free help: You can get free tax preparation help from IRS-certified volunteers if you earn less than $67,000, have a disability, need language support, or are 60 years or older.
- Find answers: Visit the IRS’s Interactive Tax Assistant to get answers to your tax questions.
- Use tax preparation software: Do some research on software options—both free and for-purchase—to find the one that’s right for you.
- Hire a professional: Check out the IRS Directory of Federal Tax Return Preparers.
Tax season doesn’t have to be stressful. By following these steps and paying close attention to detail, you can avoid tax mistakes, maximize your refund, and ensure a smooth filing process.
As you review last year’s income and expenses, you may decide you want to be more intentional with your financial plans. A great way to turn your financial goals into strategies is to talk with a financial consultant. Visit Coast Central Credit Union’s Financial Strategies Center to make an appointment with one of Coast Central’s financial professionals.
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