We are all human. We all make mistakes at some point in our lives. We can make mistakes with all kinds of things. Tax being one of them. In this article, we will have a look at what some of the most common tax mistakes are and how they can be avoided. Once you know what they are, you will then be able to avoid them.
1. Incorrect math.
Some of us can find math difficult. A simple math mistake could be very problematic when it comes to your tax return. Always use a calculator if you are filing out a paper form. Otherwise, do your tax return on the computer. The computer or other means of technology will calculate your math automatically. They are more likely to get the correct results.
2. Using The Incorrect Social Security Number.
Most people should know what their social security number is. Some like to think they can remember it without looking it up. Rather than rely on memory, always check what is on your card before you enter it into the system. If your number is incorrect, your tax return will probably get rejected. Always, double check your number even if you are certain it is correct.
3. Not Remembering What The Important Deductions Are.
There are all kinds of deductions that are available to those who pay tax. If these are not claimed, then you are simply wasting money. If you are unsure on a deduction, all you need to do is ask. If you have made a charitable donation, these too can often be deducted. So, do your very best to remember throughout the year what deductions can be claimed. Put them in a safe place to keep for your next tax return.
4. Missing Out On Tax Credits.
Tax credits are designed to help you save money from lowering your tax liability. There are all kinds of credits that can be used when you file your tax. The Child Tax Credit is one of them. If you are earning low-income, then you may be able to claim the Earned Income Tax Credit. Many people who file their tax never consider these things. This means that they miss out on them.
5. Not Including Other Income.
Sometimes people forget to include other income they may have earned during the tax year. It does not matter how big or how little the income is, it must be included on your forms. Always, always report your income. Many brokerage companies and banks have special forms that you can fill out for this. Use these to report your income.
6. No Signature.
It is not hard to sign a form. Yet, this is so easily looked over. If you do not sign the form, then your tax return will not be processed. If the form involves two people, make sure the other person has signed it too. Always double check your form to make sure it has been signed by all relevant parties.
7. Not Logging Your Tax By The Due Date.
Everybody has busy lives. It is so easy to forget that the tax year is coming to an end. Before you know it, the date has come and gone. To avoid missing the due date, find out what it is well in advanced and mark the date in an obvious place so you do not miss it. If your tax is not lodged by the due date, sometimes taxpayers will be penalized. Prepare for this date as early as you can. Then you wont be feeling stressed. You will also avoid rushing around trying to gather everything together.
These are just some of the common tax mistakes that many taxpayers make. Now that you are aware of what they are, you can avoid them and do the right thing.
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