Let’s face it, there’s a lot that can go wrong when filing your taxes. It’s a stressful, often intimidating process that makes a few hours feel like an eternity.
What’s more, reports from a few years ago show that some 80% of people made a mistake when filing taxes that may have cost them dearly, whether through an audit or a return error.
So what are these common tax mistakes and how can you avoid them? Keep reading to find out!
Forgetting to File
How many times have you let Tax Day creep up on you?
While most people procrastinate when filing taxes, the IRS isn’t as forgiving as you might hope. Should you forget to file your taxes, you could end up getting audited. The process can be extensive, frustrating, and drawn out for months.
The safest way to avoid forgetting to file taxes is to set a reminder a few weeks in advance. You can also file your taxes as early as January 1st.
If you’re reading this and it’s too late to file, you may be happy to hear that there are some services that can still help. Businesses like https://silvertaxgroup.com/unfiled-tax-returns/ can help you navigate the IRS’s auditing process.
Miscalculating Your Income
Research shows that 43% of people now have at least one side hustle. If you make over a certain amount through that side hustle, you’re legally required to report that income to the IRS.
This is where filing can get sticky, particularly if you have multiple gigs.
You’ll need to report each job on your taxes, so be sure to read up on the latest tax code to make sure you’re including the right info.
Missing Important Deductibles
It’s not always easy to know what you can and cannot deduct, particularly if you’re self-employed or recently underwent a major life change.
If you fit into the above categories, your best bet is to let a professional handle your taxes. While most tax software will cover the basics, you could still miss something that could save you a pretty penny.
Giving the Wrong Routing Number
While you can definitely argue that the U.S. tax system isn’t as efficient as it could be, taxpayers can have their tax returns sent straight to their bank via direct deposit.
Of course, that’s all predicated on giving the correct info.
Always double-check that you’ve included the proper account and routing numbers before filing. There’s nothing more frustrating than spending hours on your taxes only to have a simple error prevent you from receiving your return.
Avoid These Common Tax Mistakes
Filing taxes is a huge pain, but these tax mistakes can make it a straight-up nightmare.
Remember to give yourself plenty of time to file, paying close attention to your deductibles and income calculations. While an audit from the IRS is rare, they happen all the time. One mistake could land you in legal hot water.
For more tips on keeping your finances in order, make sure to check out the rest of our personal finance content!
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