Real Estate

Avoid tax return errors that could cost you

Did you know that the average person spends approximately 12 hours preparing their 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’re in a hurry. Errors, no matter how simple, can delay your refund. Here are some common mistakes made on tax returns and what you can do to avoid them.

Get Organized: If you don’t already have your tax information, you better start now. Missing information may have the potential to cost you unnecessary funds.

Incorrect Social Security Number or Incorrect ID: The SSN must match what is on your Social Security card because the IRS checks all returns against the Social Security Administration database. Plus, it’s easy to zero in on the numbers you 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 haven’t reported them to Social Security.

Filing Status Errors: There are five filing status options (single, married filing jointly, married filing separately, head of household, and qualifying widow(er) with dependent) used to determine your filing requirements (standard deduction, eligibility for credits, deductions, and 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 errors. If the IRS finds those errors, they can recalculate them for you, but not to your advantage. Therefore, you may want to review your calculations before submitting your forms. In addition to possible mathematical errors, there may be calculation errors related to tax base, withholdings, estimated and miscellaneous tax payments. tax credits.

Incorrect bank account numbers for direct deposit: It’s important to double check your bank’s 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 possible penalties and interest.

Unreported Income – Don’t forget to add income from anything other than your place of employment. 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 also receives copies of all those forms.

Filing late or even not filing at all – Many of us can become overwhelmed with details and put off filing our returns on time or not file at all. Sooner or later, the IRS will find out you’re late and you’ll get 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 if you pay the taxes due before the filing deadline.

Start saving: Whether you owe the IRS or are waiting for a refund, it’s always good to save. Sometimes refunds are delayed, so you can’t delay your bills waiting for your refund. Be sure to set aside a portion of your income now so you’ll be prepared to pay any unexpected payments.

Use your return wisely: If you’re expecting a return this year, make sure you use it wisely. Before you spend it, be sure to prioritize your financial needs and earmark the refund for that.

My advice to you: Be sure to prepare your tax return when you have the fewest slippages. If you’re interrupted or have annoying distractions, stop what you’re doing and finish your comeback later. A little extra time spent on your tax return will go a long way toward filing an accurate return. By following these simple tips, you can protect yourself from getting a letter from Uncle Sam telling you that you owe extra money.

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