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Common Tax Mistakes to Avoid When Filing Your Returns

Making mistakes on your taxes can result in losing out on a refund, having to pay additional taxes, or even being audited by the IRS. Thankfully, most mistakes can be easily rectified prior to filing your return.

Be sure to double-check your math, use tax software that performs this function, and carefully read through the IRS instructions for every line of your return.

1. Forgetting an Income Source

Avoiding income or deductions that could significantly decrease your tax refund is a costly misstep that could force additional taxes due, trigger an IRS audit, or both. Filing electronically or paper makes it easy to miss anything that might raise red flags with the IRS.

Some mistakes are as straightforward as transposing or missing a number, while others could lead to more significant problems like miscalculations or incorrect deduction claims. Tax software that double-checks math can help protect against these types of mistakes; so can hiring an experienced tax preparer.

Keep an eye out for spelling and names, as each person should match exactly with what appears on their Social Security card. In addition, every prompt on a form must be answered accurately — including signature requests — otherwise the IRS could send notice out with reasons as to why your return has been flagged or an adjustment has been made.

2. Not Taking the Credits and Deductions You Are Entitled To

One of the most frequent mistakes involves failing to claim all available credits and deductions, which could reduce your tax owed or increase your refund amount. Therefore, it is essential that you know all eligibility requirements before filing your taxes; be vigilant for errors on each line of your tax filing form when filling it in and carefully review every line for errors in order to maximize benefits from credits and deductions.

Math mistakes can also be easy to make when entering numbers related to income, capital gains and deductions. Tax software that checks math can flag errors; having someone double-check your work can also help.

Another frequent error involves failing to sign your return, which the IRS will not accept without being signed by you first. Failure to do so may result in fines and delays; so before beginning tax preparation it’s advisable to gather all of the documents needed such as W-2s, 1099s, receipts for deductions and documentation for credits that need filing before proceeding systematically with tax preparation.

3. Not Including All Deductions and Credits

Reducing tax deductions could be one of the easiest ways to leave money behind. Be sure to thoroughly review all available deductions, working with a tax professional if necessary, and make sure no opportunities are being missed out on.

Errors in math calculations can throw off your entire return, so it is wise to double-check numbers and use a calculator in order to avoid making any mistakes. Also ensure your name matches what the IRS has on file as well as spelling correctly (including middle initials) If claiming a refund, always verify your bank account information, including routing number and account number before filing.

Completing your taxes correctly is no simple feat, and even small errors can have serious repercussions. To help avoid common tax filing errors and keep an eye out for any new legislation that might alter your returns this year, follow these tips and keep an eye on any updates to legislation which could alter them.

4. Not Including All Wages

Every year, millions of individuals file tax returns in hopes of receiving refunds; others simply aim to pay their due taxes promptly in order to avoid underpayment penalties.

No matter why or for what purpose you file your return, making mistakes on it can significantly delay or derail its processing. Luckily, most errors can be avoided with just a few precautions taken beforehand.

Check for spelling errors and verify that all numbers match up, particularly regarding income. Double-check that what you report on your return corresponds with what has been filed with the IRS in terms of W-2 forms, 1099 forms and K-1 forms submitted over time. Also ensure you withhold enough money throughout the year in order to avoid underpayment penalties; should any questions arise consult a professional who will help ensure a seamless filing experience.