Common Errors When Filing Income Taxes
Nowadays, thanks to tax preparation software, it is easier to file annual tax returns. However, with just a single slip in putting in your information on your computer could end up costing you, either in the form of a larger tax bill or a smaller refund. Additionally, even when a mistake, either on your PC or paper forms, doesn’t cost you any money, it could delay the receipt of any refund you’re expecting.
Another thing that you need to remember, is that changes in your taxes can also complicate the annual tax-filing exercise. For example, in the 2015 tax year, the reporting and filing of requirements prompted by the Affordable Care Act have caused a countless of difficulties for taxpayers, tax professionals and even the IRS. Whether or not are there are special taxes applied in the present year, there are still plenty of incidents when you may mess up a 1040 form.
Incorrect Math Calculations
Every year during tax season, the top most common mistake that happens on tax returns are bad math. Any errors in arithmetic or in moving figures from one schedule to another will get you an instant correction sign. Be warned, even the most simple math mistakes also can lessen your tax refund or result in you owing more taxes than you thought. Your first and foremost job is to get all the numbers right because the IRS will be double-checking numerical entries against its copies of your tax statements (W-2, 1099s and the like).
One common math error that can occur are computation errors, during this event taxpayers or their accountants make mistakes in figuring such tax-return entries as taxable income, withholding and estimated tax payments. Additionally, credits and special deductions also pose problems.
One important thing you need to recall, the IRS is not just all about numbers, but words too, especially correct names. If ever the names of a taxpayer, his or her spouse, or even their kids don’t match with the tax identification number that the Social Security Administration will provide it may start different problems with the processing. Typically, this issue is a normal one especially for women who are newly married. That is why it is important that you should announce to the Social Security Administration as soon as she can when she got married and will be changing surnames.
Added Income Means Added Filing Work
If ever you have additional jobs, for example, as a contractor you will most likely receive a Form 1099-MISC detailing the extra earnings. Never miss on declaring these important details or the IRS will count this against your owed taxes. There are many other tax problems that you will bump into, it is crucial that you know how to amend them to avoid problems.
Source: Tax Return