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Common Mistakes to Avoid on Your Tax Return |
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Author: Richard Chapo Article source: http://www.articlealley.com/. Used with author's permission.
Preparing your tax return is a task similar to mating with an elephant. It takes a long time, there is a lot of yelling and you usually have a headache by the end. All of this can lead to mistakes on your return.
Most taxpayers set out to tell the whole truth and nothing but the truth when filing their returns. By the time you have filled out your eight worksheet related to line 27, subsection A of the 1040 form, you don't know if you are a liar or a saint. It is all so confusing that it can bring a person to their knees. Confusion and frustration, of course, lead to mistakes. Mistakes then lead to unwanted attention from the IRS. Well, all attention from the IRS is unwanted, but you get my drift.
Ironically, it is mistakes with basic things that get most people in trouble. The IRS looks for basic information from your tax return. When your return doesn't match other records, you have a problem. When it doesn't make sense in and of itself, you also have trouble. Here are some of the basic mistakes to watch out for.
1. Check Your Math - Did you carry the one? Are you sure the decimal is in the right place? The biggest error found with tax returns has to do with math errors. If you drove 1,000 miles on business, how could your tax deduction be $4,450? You made a mistake somewhere. It should be $445. As painful as this may sound, you should sleep on a finished tax return and recheck it the next morning to make sure the numbers are all accurate.
2. Married Filing Jointly - If you are filing under this status, you are effectively combining two tax returns in one. The IRS, of course, does not know this unless you tell them. Make sure to enter your social security number AND the number for your spouse.
3. W-2s and 1099-MISC - If you are a salaried employee, your employer should have issued you a W-2 form. Make sure to attach it to the tax return when you send it off. If you received 1099-MISC forms as an independent contractor, do NOT attach the forms to your tax return. The person issuing the forms to you already sent them to the IRS.
Finally, a bit of practical advice. You are expected to report your accurate earnings and there is no exception to this rule. Many independent contractors run afoul of the IRS in this regard. When they do not receive a 1099-MISC from a client they performed services for, they assume they don't have to include the revenues on their tax return. Um, no. You must report all income regardless of what other people did or did not file with the IRS.
Richard A. Chapo is with BusinessTaxRecovery.com - providing information on taxes.
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