How to Avoid Common Tax Mistakes

Even though the 2009 tax season is over for most people, you still need to keep in mind how to avoid common tax mistakes for next year's tax season. Many of these mistakes can be avoided by filing your return electronically; others can be caught with a quick proof of the return before you mail it.

Many people try to reduce the possibility of filing errors by turning their returns over to tax professionals or using computer software. But even in these cases, a close review of your return is critical. In the final inspection you might find something that slipped by you on the computer screen or that your accountant entered incorrectly. Even if the error doesn't end up costing you any real dollars, it could delay the receipt of any refund you're expecting.

Read on for information on how to avoid common tax mistakes.

Disclaimer

The content in this page is not a substitute for professional financial advice. Please contact your financial adviser before using the information presented here.

How To Avoid Common Tax Mistakes Introduction

  • Just one mistake on your tax return could delay your refund. While the IRS says e-filing can help you avoid some of the most common mistakes, there are other ways to help ensure that your tax return is accurate. From math errors to forgetting to sign your return, there are steps you can take to make your tax return mistake-free.

Step 1: Common Mistakes

  • With millions of tax returns being submitted each April, the IRS has identified some of the most common mistakes people make on their taxes. They include:
  1. Math errors: use a calculator to ensure accuracy, and always double-check your figures
  2. Incorrect address: use the peel-off address label on the tax return the IRS sent you
  3. Not claiming the right status: only check one filing status box on the return
  4. Tax tables: be sure to use the correct column
  5. Incorrect Social Security number: check twice to be sure your Social Security number is included on your return, and that it's the correct number
  6. Routing and account number errors: if you are using direct deposit for your return, an incorrect bank routing number could delay your refund
  • Other common errors include forgetting to sign and date the return, and forgetting to attach the necessary forms, including W-2s and 1099s. And if you owe money, don't forget to enclose a check!

Step 2: Other Mistakes

  • In addition to the more simple mistakes, other more complicated mistakes can be made on your tax return. They include:
  1. Not claiming all deductions and credits
  2. Forgetting to claim income not included on W-2s or 1099s
  3. Taking a standard deduction when itemizing might be more beneficial
  4. Not keeping a copy of your return

Step 3: File Electronically

  • Filing your tax return electronically, or e-filing, can greatly increase your chances of accuracy. Computer software services like TurboTax and TaxCut have built-in safeguards to eliminate the chances of simple math errors and other mistakes.

How To Avoid Common Tax Mistakes Conclusion

  • Despite our best efforts, mistakes do happen. But there are things you can do to avoid common—and potentially costly—mistakes on your tax return. To ensure accuracy, consider filing your taxes electronically. If you insist on filing a paper return, be sure to double-check it before you mail it in. Check your math, and be sure you've supplied the correct address and Social Security number and attached all necessary forms to the return. A few minutes of checking before you send in your return can potentially save you major headaches later.


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