Common Tax Mistakes to Avoid
Mar 18, 2018
It’s tax time again! All you need is: calculator, pencils, hundreds of receipts, tax forms and pay stubs. Now all you have to do is get to work. There’s numerous ways to get your taxes done including: tax-prep computer programs, handing them over to an accountant and lastly doing it yourself. Despite having numerous ways to get your taxes done, there are a few common mistakes that people can make on their tax returns.
1.) Faulty Math
This just happens to be the most common mistake on filed taxes. One small miscalculation can change all your numbers and get you into trouble with the IRS. When you or whoever you choose is preparing your taxes, be sure to quadruple-check the math before filing.
2.) Name changes and misspellings
When you are preparing your taxes the main thing you think of is numbers, but don’t forget everything else on the tax form! Always remember to use the name that the IRS has on file for your Social Security number. Make sure that you spell your name right and if you have recently changed your legal name, be sure to let the Social Security Administration know.
3.) Omitting extra income
Many times, people forget to include any other sources of income, besides their primary job, on their tax forms. This may include any freelance work they have done throughout the year. If this applies to you, fill out a 1099-MISC and file it with your taxes.
4.) Deducting funds donated to charity
Only donations to a charity with a tax-exempt status can be deducted from your taxes. If you have not made any monetary donations but have made donations of food and/or clothing, those items must be in decent shape to be eligible for a write-off. You will calculate the value of what your non-monetary donations according to what they would be worth if you’d sell them now. Also, don’t forget to include those charity tax receipts when you file!
5.) Using the most recent tax laws
There have been some major changes to the tax code this year. While most of these changes won't take effect until you file your first taxes for 2018, there are some changes that are effective for this year, including the following:
- The standard deduction increased to $6,350 for single, $9,350 for head of household, and $12,700 for married filing jointly.
- The maximum earned income tax credit increased to $6,318.
- The maximum income limit for the EITC increased to $53,930.
- The foreign earned income deduction increased to $102,100.
- Annual deductible amounts for Health Savings Accounts increased for individuals only, to $3,400.
6.) Signing your forms
If you're filing through the USPS, be sure to put your signature wherever necessary, and get a mailing receipt. If filing online, you can use a PIN instead. Most places that require a signature will need to be dated as well.
Check your forms for errors before submitting and file with confidence!