Navigating taxes can be complicated, and it’s all too easy to make mistakes. Some mistakes are relatively harmless but inconvenient to go back and fix. Other errors, however, can increase your risk of audits and penalties. There are many common tax mistakes to avoid, but you don’t have to navigate this confusing process alone.
At Bennet CPA, Merrill Bennet is a certified public accountant in Colorado Springs who specializes in preparing accurate tax returns. Because we’ve seen it all, we can break down some common tax mistakes to avoid and how we can make filing your taxes a breeze.
Common Tax Return Mistakes
Filing taxes isn’t anyone’s idea of a fun afternoon, and when you’re doing something you’d rather not be doing, it’s easier to make a mistake or overlook important details. Some common tax mistakes include:
1. Messing up the math
Math errors on taxes happen — we’re only human, after all. According to the IRS, they issued over 9.4 million math error notices as of April 2022. Whether missing a number, putting a decimal or comma in the wrong place, or completely messing up a more complicated calculation, going back and fixing math mistakes is frustrating. Math mishaps can also reduce your tax refund or result in a higher bill.
That’s why it’s essential to double-check your math before you submit your taxes, even if you’re confident about it. Or better yet, work with a tax professional to ensure the math is accurate.
Like inaccurate math, misspellings are all too common in the tax world. It can be challenging to spell everything perfectly, especially when the paperwork feels neverending, and you just want to get it over and done with. Remember, a name listed on a tax return should match the name on that person’s Social Security card. So, if you’ve changed your name recently, it’s vital to keep that in mind.
3. Filing too early
Filing early may seem like a win, but sometimes it causes more harm than good. A common tax mistake is filing before receiving all the proper documents. As a result, there may be a hold-up on your tax return, making filing prematurely not worth it.
4. Inaccurate information
All income received and reported on should very carefully be entered. It’s pivotal to double-check this information as you enter it to avoid making a preventable mistake that could come back to haunt you later.
5. Credits and deductions errors
This mistake happens when A.) you don’t take credits or deductions when you have them, or (B.) you take credits or deductions when you don’t. As a result, you’ll have to go back and fix the mistake or risk owing penalties and interest.
6. Incorrect bank account numbers
Many people choose direct deposit for their tax returns because it’s the most convenient option. However, bank account and routing numbers are lengthy, and one wrong move on your keyboard or pen could spell disaster. In this situation, your tax return won’t process, or the money ends up in someone else’s account. Inputting your bank information wrong is a common tax mistake to avoid at all costs.
7. Choosing the incorrect filing status
Did you get married recently but picked “Single” on your taxes out of habit? It happens! This common mistake can reduce your refund, or you’ll owe more taxes. Double-checking your forms is essential to avoid this error.
8. Forgetting your signature on tax forms
Filing your taxes involves a lot of paperwork and signing your name many times. If you leave even one form unsigned, your tax return won’t get processed. If you’re married and filing jointly, you and your spouse must sign the tax forms together. You can avoid this by filing electronically and digitally signing your papers.
9. An incorrect or incomplete social security number
In the hustle and bustle of tax season, it’s easy to trip up and make a mistake you think would be obvious to avoid. However, it’s common for people to mistakenly put the wrong social security number down or even forget to put it down entirely. This results in a slowed return process or a return that doesn’t get processed. Ensure every Social Security number you enter is correct, especially when adding a spouse and children’s information.
10. Not reporting additional income
If you have any non-W-2 earnings, you must fill out certain forms. If not, your refund may be too high, and the IRS will eventually take note. It’s always better to be safe than sorry and report any additional income you have made throughout the year, even if you don’t believe it’s a significant amount.
Avoiding Common Tax Mistakes Is Easy With Bennet CPA
Now that we’ve gone over some common tax mistakes to avoid, here’s one way to prevent them from wreaking havoc on your finances: Contact Bennet CPA! Merrill Bennet will take the time to walk you through each step of the tax filing process, ensuring no mistakes happen along the way. You can ask questions, receive accurate information, and file with knowledge and confidence.
To learn more about common tax mistakes to avoid or any other tax-related concerns, contact Bennet CPA today.