Founded by a former IRS Agent

Founded by a former IRS Agent

Top 10 Most Common Tax Errors

February 19, 2015

Top 10 Most Common Tax Errors

 

When dealing with a year’s worth of information, it’s easy to make mistakes. Luckily, modern software has taken a lot of the guess work out of filing your taxes, but there are still potential pitfalls to avoid. Each year, new incentives, acts and changes can cause errors on your form, costing you money or delaying your return. Be aware of these ten areas where tax forms are most likely to get messed up.

Math
The simplest mistake to make is bad arithmetic. A miscalculation could cause your return to be rejected, decrease your refund or increase your dues. Tax programs and digital calculators can only help if the numbers you put in are accurate.

Data-Entry

In this case, the numbers you entered aren’t the right ones to begin with. When adding up your taxable incomes, tax credits and other deductions, you may have left some aspects out. Be sure to take advantages of all worksheets and programs that help you figure out these whole numbers before placing them onto your 1040.

Signatures
In a world of electronic documentation, one of the easiest steps to forget is adding your signature. Most electronic sites and programs will instruct you to sign digitally. Even so, a tax return will be rejected without a signature and date.

Social Security
For the IRS, you are your Social Security number. Due to identity theft problems, the IRS no longer includes your SSN on any paperwork they send you, but you must provide it on your return. These numbers are even more essential when claiming dependents for your children.

Donation
Charitable donations are only credible when they are with tax exempt organizations. On top of this, do not over inflate your donated value. Donations of items like cars are only credited if the item was in good condition. Even then, the value is only what the object was worth when you gave it away.

Names
Amongst getting all your numbers right, be sure to use the names the IRS has on file. This is a particularly common problem for newlyweds who have yet to notify the Social Security Administration of their last name change. Use official names only.

Additional Incomes
If you work more than one job, you have to declare your earnings to the IRS. Your additional earnings are taxable and receiving a rejection is the least of your worries. You could end up having to pay penalties or interest on the delayed taxes.

Direct Deposit
Direct deposit is a great modern way to expedite your return. However, there is currently no system in place to recover returns that have been lost in transfer. Check and double check your account number if you are using this option.

Deadlines
Putting off tax paperwork is a time honored tradition. With digital submissions, you don’t even need to worry about the postmark date. If you do find yourself going past April 15th, you can fill out a 4868 to extend your deadline till October. Even so, send all of your tax information with your extension paperwork to avoid encountering late fees.

Electronic tax filing has made the entire process easier to file your own taxes. Stay vigilant for these common mistakes, and you will swiftly receive your return free of penalties or adjustments.

For personal income tax preparation help, contact Glendale CPA, Vardan Pogosian for a free initial consultation. Our firm prepares taxes for individuals and families. Let the experts at Pogosian & Company, CPA handle all your tax preparation work and future tax planning initiatives.

It’s time to schedule an appointment with Pogosian Nazaryan & Company.