Stupidest Tax Mistakes To Avoid This Time Around

Stupidest Tax Mistakes To Avoid This Time Around



Stupidest Tax Mistakes to​ Avoid This Time Around
As the​ season to​ fill tax returns and forms approaches people get confused and nervy .​
The IRS dons the​ role of​ a​ huge brooding monster that is​ all set to​ devour you​ .​
Unfortunately most of​ us keep postponing filing of​ papers and putting our affairs in​ order until the​ very last minute and then confusion and stress reign supreme.
The last minute dash and the​ lack of​ knowledge of​ tax laws,​ depreciation formulas,​ and deductibility guidelines can land you​ in​ a​ soup .​
And,​ this means coughing up precious dollars that you​ could find better use for.
Errors however small can result in​ payment of​ higher taxes and can mean a​ delayed or​ no refunds .​
As in​ everything,​ the​ way to​ smoothen things is​ to​ be systematic and file papers pertaining to​ tax returns carefully throughout the​ year .​
Do not throw away bills,​ vouchers,​ or​ receipts that support your tax forms .​
Next discipline your self to​ read the​ IRS rules and regulations .​
Do not depend on​ what others tell you​ or​ hearsay .​
Check out facts for yourself.
Everyone makes tax return mistakes even professors,​ CEOs,​ and VPs .​
Some common mistakes which are just plain idiocy or​ stupid are:
1. Benefits claimed pertaining to​ dependent children .​
Often if​ you​ fail to​ know the​ allowed exemptions you​ may fail to​ make a​ correct claim or​ make an​ incorrect one .​
To help clear confusion in​ 2018 the​ IRS created a​ uniform definition of​ a​ child and the​ broad outlines are at: www.bankrate.com/brm/itax/tips/20010208a.asp .​
However if​ you​ have any doubts or​ questions clear them before filing your return.
2. Most errors are calculation mistakes and wrongly filled in​ figures .​
Always check and recheck where the​ full stop or​ comma is​ applied .​
Go through the​ numbers patiently and do your totaling on​ two separate days .​
Better still ask a​ family member or​ friend to​ check the​ figures for you​ .​
Consider using tax software programs these ease many problems in​ filing your return .​
When filling details keep in​ mind the​ fact that the​ IRS will check entries against W-2,​ 1099 and other statements that pertain to​ your tax .​
If a​ discrepancy is​ found it​ just means trouble as​ well as​ delays.
3. Forgetting to​ sign and date the​ forms is​ a​ mistake that leads to​ the​ IRS just not processing your return .​
Be sure to​ check all the​ pages carefully and ensure you​ have not missed anything however small and insignificant .​
Another common error is​ forgetting to​ write your social security numbers or​ tax ID numbers .​
4. Often tax payers forget to​ submit all relevant forms like W-2,​ 1040,​ or​ 07,​ or​ 16 .​
Check the​ relevant schedule for each claim and ensure that all relevant and supporting forms are attached to​ the​ return .​
5. Failing to​ keep track of​ investments,​ allowed deductions,​ interests paid or​ earned and so on​ .​
You need to​ maintain details of​ when you​ invested,​ what dividends were paid,​ whether any taxes were deducted on​ maturity,​ any capital gains,​ taxes paid on​ sums earlier .​
If you​ clearly keep track of​ taxes paid you​ could avoid paying tax on​ amounts already taxed .​
The calculations must be done carefully and systematically to​ avoid faux pas.
6. Choosing the​ EZ form 1040Ez rather than the​ long form .​
If your earnings,​ expenditure and other things are simple then just take the​ trouble of​ filling the​ longer form .​
You will be surprised at​ the​ amount you​ can save in​ taxes .​
The longer form allows subtractions from taxable income like student loan interest,​ alimony paid,​ donations of​ charities and so on.
7. Missing the​ deadline and asking for an​ extension .​
This means paying late penalties as​ well as​ interest .​
In case a​ personal problem prevents filing in​ April you​ need to​ submit form 4868 by the​ April deadline to​ get an​ extension.
8. Using a​ wrong table to​ make calculations .​
Two things need care filing status and the​ right tax tables .​
Using wrong ones or​ filing under a​ wrong status will put you​ in​ more trouble than you​ need .​
And,​ the​ mistake could mean paying taxes on​ taxes or​ on​ investment earnings .​
Be astute and compute your tax using the​ work sheet at​ the​ back of​ the​ booklet.
9. Three laughable mistakes tax payers make is​ to​ fill out the​ check wrong and forgetting to​ sign it .​
Posting the​ forms without the​ proper postage on​ the​ return package .​
And,​ worst of​ all not using the​ pre-printed label and envelope provided by the​ IRS .​
The IRS has modernized its systems and some of​ the​ silly mistakes can be avoided if​ you​ opt for electronic filing .​
Last year almost over 50% of​ the​ taxes were filed using e-filing .​
The advantages are many .​
All the​ forms you​ will need are on​ tab,​ the​ software takes you​ step by step through the​ filling process,​ the​ electronic calculators rarely make errors,​ and most of​ all e-filing forms get processes quicker the​ turnaround is​ 14 days .​
See: www.irs.com/ .​
If in​ doubt,​ you​ can e-file using the​ services of​ an​ authorized tax professional .​

File on​ time and correctly .​
Avoid heart burn and hypertension.




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