your tax return, tax tips — August 10, 2015

Common Filing Errors You Can Avoid

by Bob Williams

filing mistakes

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 money should 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 electronic tax return even faster.

Filing Status

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, click the “Help Me Decide” link on the Personal Information screen. It can walk you through the brief process that can give you a sharper picture of your situation.

Name and Number, Please

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.

Sometimes the Secondary Forms are Essential

A lot of people have second jobs these days, and many of them act as contractors. The extra earnings could be reported on a 1099-MISC instead of a W-2.

For savings accounts and investments, you could have a 1099-INT or 1099-DIV to report.

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 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.

Give – And You May Receive

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 care 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 meet the IRS rules for acceptable donations of property. You can check out the IRS Publication 526 for all the latest rules and regulations.

Take It to the Bank

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 routing number and account number for every account you intend to use. Enter those routing numbers and account numbers VERY carefully. A 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. If the error means the funds cannot be direct deposited, the IRS will issue a paper check for the refund, and then mail it via the Postal Service.

Sign on the Dotted Line

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, you can’t efile without it.

The Clock is Ticking

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. 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 15.

For those who just don’t have the money now to pay tax owed, there’s still a way out. The IRS has an installment plan to string out your payments. You can check out the IRS’s plan here, or download Form 433-D, Installment Agreement.

So do yourself a favor. Bite the bullet, sit down, and do your 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.

Sign up for more of this.

Subscribe to our blog for year–round finance strategies and tax tips. We’re here to remove the dread from filing taxes.

Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.
Please complete the reCaptcha.

It’s not too good to be true. See what others are saying.