Saturday, April 18, 2015

Top 7 Tax Mistakes: Information Can Go A Long Way

As I do everyday, I was on CNN Money when I found myself on an article that showed and explained the top 7 mistakes that citizens make on their tax returns every year. To look at the original article, please click here. Let's take a look at the seven mistakes and how to prepare to not make one when you are ready to sit down and do you own taxes this year.

No Signature

This is one of the mistakes that many people would look at and say, "I would never." Well people, never say never, because everyone is subject to forgetting to sign something at one point or another. It just happens that many people's time is during tax season! I conclude for myself that I may be so worried about the more complicated areas of my taxes that I just don't worry about it or pass it and assume later that it has already been done.

How to fix: Before you push a pen onto your tax return get a sticky note or colored tape and mark all the places that if not filled out will result in an audit (we sure love to be audited!). That way when you are finishing up your return, you will have to remove the sticky note any way and remember that maybe that area needs a second looker.

Wrong Social Security Number

I must say that if one is at the age where they are filing a tax return that maybe they should have their SSN already memorized, however I do realize that husbands, children, etc also come into play during this time. 

How to fix: Remember those Pokemon or baseball card holders? Well who knew they work very well with holding important smaller documents like social security cards! Just slide all of those into one of the folders and then put it into the area where you keep all your important documents (binder, file, etc). Come tax season pull out you will be able to look at all of the cards at once and keep them organized.

Wrong name
This another area where one was probably just a little absent minded while filing. It can also be a little difficult if you or a member of your family goes by a different name than what is on their social security card.

How to fix: This can be fixed as easily as double checking or making sure that the names match those on your social security cards. Don't rush or those simple little mistakes will go overlooked.

Wrong Filing Status
This is a quite understandable mistake if your status has changed since you previously filed your taxes. Common reasons for your status changing is: marriage, divorce, death, etc.

How to fix: Understand what would cause for you to change your status and be aware if any of these events happen to you. For information about what each status's qualifications are click here.

Mistakes Claiming Credits and Deductions
Deductions may be one of the most "fun" parts of filling out your taxes right behind receiving your tax return. Credits and deductions are grant such as the Child and Dependent Care Credit and the Education Credits.

How to fix: Make sure you have a list of all the credits that take place and see if you qualify for them. If you are unsure if you qualify for a certain tax credit please take a look at this link or access your state website to see where there can be further assistance for your questions.

Wrong Bank Account Number
I will be quite honest that I am not even 100% sure of my own bank account numbers. This is a very important step to having your tax refund being deposited into your account. This is a big reason for filing your taxes correct?

How to fix: If you are unsure of what your bank account number is that you would like to have refund or tax expense to come from or go into then look at your previous bank statement.

Math Errors
Everyone isn't amazing at math. Even the smartest mathmaticians probably have been caught messing up simple calculations every once in a while.

How to fix: Having a calculator if you are filing your taxes by hand is probably a must. Modern times is making it even easier to file electronically and even doing all your addition and subtraction for you! Just make sure in the end to double check every entry.

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