When it comes to filing taxes, I’ve basically seen it all. Between helping my family, filing on behalf of clients and doing my own, I’ve had first-hand experience with all types of tax returns.
It seems the older we get the more complicated things are, and that’s especially true with taxes. Maybe you had another child, need to buy a bigger house, or started a small business out of your home.
While every-ones tax situation is different, there are common mistakes I see over and over. Many of them are simple and easy to avoid, but can cause delays in processing the return and getting your refund. Here are common tax errors to avoid when filing your taxes this year.
Not using your real name
My dad has this problem every year (you would think he would learn). His real first name is George, but everyone calls him by his middle name. He always signs his name with his middle/last name combo, and he even has bank accounts with his middle name instead of his first name. It gets very confusing.
However the IRS requires you to enter your name EXACTLY how it is on your social security card. For example, my name on my social security card includes my middle initial. So when I fill out my taxes I need to put the “L” under the middle initial box.
You can’t file under a nickname or middle name, and you need to sign the tax return the same way – middle initials included. This is very important for your children’s names too. All the papers need to reflect the same information.
Not checking all social security numbers
If you’re doing your own taxes online, or paying someone to help, always double check the social security numbers. Once I start inputting lots of numbers sometimes my mind will make a mistake or invert the numbers.
This is very common, but can delay your return by 2-3 days. It takes the IRS about 24 hours to receive your return. If the information is wrong, they will send it back to you for a correction. Then you will have to start the process over, which wastes valuable time.
Forgetting to verify your bank information
This is very similar to verifying your social security number. If you’re getting a refund, or having the balance taken out of your bank account, you want to double check your banking information.
If your deposit gets rejected, the IRS will eventually mail you a check via snail mail 6-8 weeks later. Or if you owe money, your payment will be considered late and additional penalties and fees will be charged to your account.
Not knowing your correct filing status
Lots of people go through changes in filing status from year to year. If you get divorced, or your spouse passes away, your filing status will be different. If you haven’t completed the divorce proceedings yet, but lived apart for the majority of the year, your filing status might not be same either.
If you aren’t sure what status you fall under, ask a tax expert for advice. It could be the difference between getting a refund and having to pay the money back. Plus you want to get every penny of credits and deductions you’re entitled too.
Claiming the same dependents
I can’t tell you how many times I’ve done a person’s taxes, to see it rejected because another person claimed their child. This is especially common between divorced parents. In most cases the custodial parent will always claim the child (unless you sign this form excluding that year).
Sometimes grandparents will claim grandchildren if they feel they supported them. The same is true with aunts and uncles; everyone in the family should all be on the same page when it comes to claiming the kids. The IRS has a checklist called the Tie-Breaker Rules they abide by, when it comes to multiple people claiming the same child.
So do it right the first time
When filing your taxes, take your time and don’t get in a hurry. You want to do it right the first time, and double check your work to avoid errors. The IRS is swamped as it is, therefore you don’t want to delay processing your return or receiving a refund, any more than you have to.
Get help if you aren’t sure about any changes that might have happened throughout the year. Your tax professional is kind of a like a doctor, don’t withhold important information because they are just trying to help. Filing information without all the facts could cause a dangerous chain of events.