It’s not surprising that many taxpayers have problems understanding taxes and filing them correctly.
Whether you use technology to simplify filing taxes or decide to do your taxes by hand, there are still many small mistakes you can make. These mistakes can cause a number of inconveniences for you, like having your tax return sent back. Sometimes, it may even cause you to receive a penalty.
Keep reading to learn what the most common mistakes are when filing taxes, so you can avoid these pitfalls and their consequences.
1. Inaccurate Information
Entering incorrect information is one of the main mistakes people make when filing their taxes.
These types of mistakes are easy to make and can lead to your tax return being delayed or even reduced. Some common ways this type of mistake occurs are:
- Not recording changes in name or address
- Incorrectly listing dependents
- Not entering information as reported
2. Forgetting to Sign
Accidentally omitting a small detail can have consequences.
If you accidentally forget to sign a page or did not put down the date, the IRS will not accept your tax form. At that point, your form will be sent back to you to be properly signed and dated, which lengthens the time until you get your tax return.
3. Incorrectly Entering Information
Typos are one of the easiest mistakes you can make when filing your taxes. Doing this can have major consequences, such as a slower tax return, receiving a lower tax return, or having to pay higher taxes.
However, this type of mistake can be easily avoided if you take the time to double-check your tax forms.
From accidentally putting down the wrong bank account number to reporting income on the wrong lines, these are some common mistakes people make when doing taxes:
- Incorrect routing and account number
- Not enclosing negative amounts in brackets
- Using the wrong column or line
- Bad math
4. Not Taking Advantage of Available Deductions
Many taxpayers avoid certain deductions, tax breaks, and exemptions that they would qualify for.
This can happen if people are not aware that they are eligible for a particular deductive. They may also avoid certain deductions out of the worry that they will receive an audit for them. Researching your eligibility for deductions and exemptions will allow you to be better informed on how you can save more money when filing taxes.
5. Incorrect Tax Breaks and Deductions
Reporting the wrong tax breaks and deductions can be done in a variety of ways and can lead to you receiving a lower tax return.
One of the most common ways this occurs is through failing to take advantage of applicable tax breaks. This includes:
- Using the incorrect filing status
- Not taking advantage of applicable deductions
- Automatically taking the standard deduction over itemizing
The other main mistakes that occur when entering tax breaks and deductions are incorrectly declaring exemptions or miscalculating your deduction.
Learn More About Filing Your Taxes Today
Now that you know the most common mistakes people make when filing taxes, you are better equipped to avoid them. This can increase your return and decrease the inconvenient consequences you may have to face if you do your taxes wrong.
If you want more financial help filing your taxes, be sure to check out some of our other articles in the Taxes section of our website today.