Mistakes When Filing Income Taxes
These days, with the help of tax preparation software, it is easier to file annual tax returns. Nevertheless, you should take note that with just one mistake in typing in your data when filing on a software it may end up costing you, either in the form of a larger tax bill or a smaller refund. In addition, even when a mistake, either on your computer or paper forms, doesn’t cost you any cash, 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 reporting and filing of requirements prompted by the Affordable Care Act have produced a numerous problems for taxpayers, tax professionals, as well as, 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, the most common error that occurs on tax returns are incorrect math. Any kind of error in your arithmetic or in moving figures from one schedule to another will get you an instant correction warning. You need to remember, even the most simple mathematical error can reduce 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).
Another typical math error that can happen are computation errors, during this event taxpayers or their accountants make errors in figuring such tax-return entries as taxable income, withholding and estimated tax payments. In addition, 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. Whenever the names of a taxpayer, his or her spouse or their kids don’t match with the tax identification number that the Social Security Administration has on record it may start different problems with the processing. Usually, this problem is a normal 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.
Additional Income Means More Filing Work
If you have any side job, for example, as a contractor you will most likely receive a Form 1099-MISC detailing the extra earnings. You must never miss out on stating these vital 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: online tax return