As anyone who's used our website before
knows, our software won't let you make many of the common errors we
used to find back in the old paper-filing days. We do all the
calculations for you, so being fumble-fingered on the old
calculator isn't the problem it used to be.
But that doesn't mean it's impossible to make a mistake. There
are still areas on any return that could cost you a little -- or a
lot -- of money if you make the wrong choice. To help you navigate
that little minefield, we have some helpful hints to help you sail
through filling out your return.
Our list is offered in no particular order. Read it all, and see
which sections best apply to your situation.
This sounds pretty elementary, but it's very easy to make a
mistake when choosing a filing status. The tax difference between
Married Filing Jointly (MFJ) and Married Filing Separately (MFS),
for example, could be pretty large, depending on your situation. If
your filing status is clear, such as Single, great! If you are
unclear as to which filing status is right for you, call the IRS at
800-829-1040 for some solid tax advice before you lock in a filing
Believe it or not, we see a lot of returns rejected by the IRS
because either the Social Security Number or the name of a taxpayer
or dependent doesn't agree with what the IRS has in their database.
It's always best to use the spellings of names as they appear on
the Social Security card, for starters. And take your time when
typing in that SSN. It's very easy to transpose numerals or
accidently hit the wrong key. Remember, that nine-digit Social
Security Number ties your identity to everything in that return, so
don't take entering it lightly.
A lot of people have second jobs these days, and many of them
act as contractors. The extra earnings could be reflected on a
1099-MISC instead of the W-2.
For savings accounts and investments, you could have a 1099-INT
or 1099-DIV to input.
In many cases, our software can sense that other forms are
needed and will alert you that you'll need to fill out this-or-that
form to properly file your return. But most of the time, it's up to
you to see that you file the correct electronic equivalent to the
paper reporting forms you get.
In most cases, no matter what the form number, you will enter
the figures shown on your paper form into the electronic form,
using the corresponding numbered box or blank. In other words, that
$125 shown in Box 2 of the paper form should be entered on Box 2 of
the electronic form.
Oh, and one word of caution. Don't make the mistake of thinking
you can skip paying taxes on your 1099 income if you just don't
report it. The same employer or fund that sent your paper 1099 also
sent a copy to the IRS. Always report your income.
While our software does much of the heavy lifting for you, there
are still plenty of additions, subtractions and multiplications you
need to do to get your data on the electronic page correctly. And
nothing will get you a notice from the IRS quicker than a return
that doesn't add up. Again, many times our software will catch your
math mistakes before you get a chance to efile. But our software
has no way of knowing if your math was right before the numbers
were put in place.
If you want to ensure your refund arrives on time, take a little
bit of extra time when plugging in your numbers. You don't want the
surprise of finding your expected refund is a lot smaller -- all
because of your clerical error.
At one time, you could claim a credit for being a first-time
home buyer. Well, the credit is no longer around, but some
taxpayers are still paying back the original $7,500 interest-free
loan that was part of the original credit. That used to be done on
Form 5405. But now you can use the HOME Form for First-Time
Homebuyer Credit Repayment and Sale of Primary Home.
As with other credits, take your time when filling out the
credit or repayment sections of the form to make sure the program
is calculating the numbers you expect.
Giving to charitable organizations is a good idea for a number
of reasons. First, it's the right thing to do; second, it's always
good to help others; and third, it can get you a nice little
deduction. But here, too, caution is necessary to ensure you get
the deduction you expect. Make sure the group or organization you
contribute to is an approved 501c(3) organization. That means it's
been approved by the IRS as a non-profit organization and that
donations can be tax deductible. If you're donating real goods
rather than cash, you'll want to make sure your donation meets the
IRS rules for acceptable donations of property. You can check
out IRS Publication 526 for all the latest rules
The IRS can direct deposit your refund into more than one bank
account. But if that's the option you choose, you'll need the bank
routing number and your personal account number for every account
you intend to use. Enter those routing numbers and account numbers
VERY carefully. A mere slipup on just one digit could send your
refund into someone else's account. And that may not be easy to
undo. The IRS will not replace refunds that were sent to the wrong
bank account due to taxpayer error.
Many online taxpayers opt to use a bank product to pay their
fees out of their IRS refunds. If you do, remember that your refund
may make an extra "hop" on its way to your bank account. It will
stop in the bank product's holding account first, then come to you.
So you'll probably see a strange routing and account number in your
paperwork before the refund comes through. That's just the account
of the particular bank you happen to use.
Whether electronic or paper, your tax return must be signed in
order to be accepted by the IRS. Electronic returns use a PIN or
Personal Identification Number to ensure you are the person on the
return. To verify that, you'll need the PIN you used last year - or
the amount of Adjusted Gross Income from the previous year's
return. And online filers shouldn't worry -- our site won't let you
skip this step. In fact, we don't let you efile without it.
Finally, we take the cover off that elephant in the room. The
deadline for filing your taxes is April 15. If you think you'll owe
money to the IRS and you're considering not filing, you really
should rethink that. Also, if you're thinking about filing an
extension so you won't have to come up with the money by April 15,
that won't work either. Extensions push back the time you have to
file a return -- not the amount of time to pay. In that case,
you'll still have to come up with the money to pay the IRS by April
So do yourself a favor. Bite the bullet, sit down, and do your
2012 income taxes. If you do that now, you can take your time and
avoid all the pitfalls we've talked about. Then, all you have to do
is sit back, relax, and wait for that refund. Hopefully.