Mistakes happen when you fill out a lot of paperwork, especially if you get tired, you’re in a rush or you’re working on something you’re not familiar with. Tax filing happens to be one of those items that can combine all three scenarios, especially if people wait until the last minute to prepare and file. In that respect, there’s a number of things people can do to avoid problems that cause filings to get returned for errors or missing information.
First, don’t wait until April 15 or your tax extension filing date to get your paperwork in. Plan on sending your tax returns in at least two weeks before the due date annually. If nothing else, this gives you some wiggle room of 14 days if you get jammed at the last second.
Second, use a tax software program and file electronically. Both options include significant error-checking programming that will find common problems and mismatches before your filing goes to the IRS. It’s worth the trouble and it involves the same error-checking a tax preparer would perform if you paid a person to do the work.
Don’t forget your basic, eligible tax credits. This is like leaving money on the table. The IRS has no legal obligation to return eligible funds to you if you don’t claim the related tax credit. You have to proactively fill out the related paperwork and ask for the funds to apply. The Remember Making Work Pay credit is one example. This totaled up to $400 for single filers and $800 for married persons filing together. But many forgot to ask for the credit, even though they didn’t see the credit on their payroll, thus missing out. A simple filling out of Schedule M and attaching it to a filed 1040 Form would have scored hundreds of dollars in savings. Guess what? Most tax software is coded to ask the question and check for it.
If you’re going to mail your tax return, make sure you’re using the right sending address. Too often filers send their returns to any old IRS address, getting the paperwork mis-routed. It is quite possible to get document lost for three months at a time in a government agency by just sending it to the wrong office location or unit. The IRS provides the correct addresses for sending in your return at the end of the 1040EZ, 1040, and 1040A instruction manual. Use it and double-check before dropping off your return in the mail box or post office.
Did you make sure to use the right Social Security number on the top of your tax form? It sounds like a silly question, but just as people can make a mistake on their own name, they can goof up a Social Security number on a tax form. Both are needed to correctly identify your filing and records. Double-check the numbers before signing and mailing your package. Most tax software will ask for the information at the beginning and double-check it again before filing. If filing manually, always make sure 1) each page has the number printed on it, and 2) it’s the correct number.
Correct filing status and calculation math are two other areas of frequent mistakes. If you’re single unmarried, then file single. If you’re married and you’re both signing, the file married, filing jointly. If you can’t stand doing your taxes together, then file married, filing separate. But don’t go and goof up the system not following instruction – for example, filing married, jointly filing, but only displaying one person on the form. After you get the dust settled on your matrimonial affairs, get your calculator out and check every dollar figure and number you entered. You will be surprised how you find at least one or two errors every time. Again, software packages can avoid these math problems since they are coded to catch them immediately when the data is entered.
Do you want your tax refund to go to your bank account or the fellow down the street? If you don’t input the correct bank account number and bank routing number, that’s what can happen. It’s convenient to have your refund deposited right to your bank, but you need to double-check that the bank information you give the IRS is correct. Verify what you put on your tax return matches what’s on the bottom of your checkbook. The first set of numbers, reading from left to right, at the bottom of a check will be your bank routing number. The second set will be your checking account number. If you’re still not sure, call your bank to get the right codes.
Remember to sign your tax return. This is required for processing and if you forget, the return will be sent back to you. If filing together, your spouse also needs to sign as well. For electronic filing, you both will use a special personal identification number, typically your birthday month and day.
If you have payroll forms to submit with your paper tax return copies, make sure to staple them to the front of your return. W-2s are small and easy to miss. Don’t assume they are attached to the back. Place them right on the front top left corner and staple away.
Make copies of everything before you mail it. That way you will know exactly what it was you sent the IRS. That said, if you did forget, you can go to your local IRS office and their customer desk to ask for a copy. They will print out all received and file tax returns up to three years back.
Mistakes happen, but you don’t need to settle with living with the problems they cause. Give yourself time to prepare your tax forms right, use a calculator, and go slowly. Rushing the job will just create more issue later on, costing you far more time to settle.
Sources:
IRS Tax Topic 303 – Checklist of Common Errors When Preparing Your Tax Return
U.S. Internal Revenue Service: Claim the Making Work Pay Tax Credit
IRS Schedule M, Making Work Pay Credit Instructions
U.S. Internal Revenue Service: Eight Facts About Filing Status