Few people like doing taxes, and many take filing their federal income tax return as a chore they want to get out of the way as quickly as possible. Unfortunately, this leads to millions of mistakes on tax returns each year that delay the taxpayer's refund, cause them to miss out on deductions, or cost them money in fines and interest for underpayment. When you're filing your taxes, be aware of these common mistakes so you can avoid them.
Failing to Sign Your Tax Return
This is a simple step, but many people simply forget. Much of the time, this is because you fill out the form using computer software or using a professional tax preparer that prints everything out as if it's ready to send in to the IRS.
The reason signing your tax return is so important is because you're swearing that your tax return is truthful, and a false return is a federal crime. If you don't remember to sign your tax return, it will be rejected and treated as if you never filed it at all.
There are hundreds if not thousands of possible deductions you can take on your tax return. Some are common, like mortgage interest and dependent children, but others are not.
If it's your first year living on land classified as a farm or you bought a new, green air conditioner, you may not realize that there are special deductions that apply to you. These special deductions aren't simply checkboxes on your 1040 and require a special form that you may never even think to look for.
Working with an experienced tax preparer who knows about these deductions and what questions to ask you could end up cutting your tax bill by thousands. Don't be penny wise but pound foolish by skipping the small cost of a professional preparer.
Math errors come in two forms. The first is simple arithmetic. No matter how good you think you are at math, don't try to to it by hand — one wrong digit could get you audited and fined.
The other is by entering numbers wrong into your software. To ensure accuracy, gather all of your tax documents in one place, copy the numbers from the original form, and check everything twice.
To make sure you avoid these and other mistakes on your federal income tax return, talk to a local tax services company, like Capital Accounting And Tax Service Inc, today.