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7 ways to avoid Tax Day mistakes — and get all your tax breaks.
Updated
To err may be human, and to forgive divine — but forgiveness is not necessarily the strong suit of the United States Internal Revenue Service, or state and local tax agencies, for that matter.
Never fear. We’ve put together a list of some of the most common tax mistakes people make before Tax Day — and how you can avoid them this year.
Table of Contents
- Don’t let these classic blunders end up costing you.
- Filling out paper forms.
- Phoning a friend.
- Passing on tax breaks.
- Tax Day? What Tax Day?
- Being too eager.
- Falling for scammers.
- Not dotting your i’s and crossing your t’s.
- More ways to come out ahead on Tax Day.
- How much does tax preparation cost?
- Who to hire to help with filing taxes.
Don’t let these classic blunders end up costing you.
Filling out paper forms.
You don’t have to go old school to save money filing your taxes. Not only do a number of free tax software programs exist, but the IRS provides a direct way to digitally file for free.
Besides saving you time, stamps and pencil shavings, online tax tools help you take advantage of deductions and tax credits that are hard to spot on paper, like child tax credits. More importantly, “filing electronically is the most accurate way to file,” says the IRS. So avoid the mistake of making more mistakes on your taxes — and file online.
Phoning a friend.
Your uncle might have dubbed himself the family tax wiz — and, hey, we have nothing against your uncle. He’s probably great at finding all his eligible credits on his own return, but unless he’s equipped with the right credentials and experienced in tax law where you live, he may not know which credits or tax breaks you qualify for.
If you’re looking for help with your taxes, it’s better to go with a professional tax preparer.
See which tax preparers are top-rated in your area.
Passing on tax breaks.
There are many tax credits available — and not all of them immediately jump to mind.
Did you know you might be able to claim a tax break for contributing to your retirement plan, owning a home, having a child, sending that child to college or taking classes yourself? If you’re eligible for credits, use them.
If you’re still worried about being audited, it may give you peace of mind to work with a certified tax preparer who will help you avoid errors.
Tax Day? What Tax Day?
Okay, we get it. Things got busy, the deadline snuck up on you, and all of the sudden you missed tax day. Good news: this is an eminently avoidable mistake, as tax day comes around once a year, and it’s usually on the same day.
If this sounds like you, start planning now to get your taxes out of the way. Collect your wage reports like W2s, 1099s and other tax forms all in one place — and set a calendar reminder for yourself that falls well before the deadline, especially if you have a tendency to miss Tax Day.
FYI, the deadline falls on April 18 this year for most taxpayers, so you have a few extra days due to the 15th falling on a weekend. Avoid any late penalties, and stick to the deadline.
Being too eager.
Getting things done early has its perks — and this is also true of doing your taxes. Filing early can mean a faster turnaround on your refund, after all.
But if you try to file your taxes before you’re truly ready, you open the door to errors and processing delays, warns the IRS. So curb the excitement, and don’t file your taxes until you’ve received all of your tax documents, which usually start hitting mailboxes mid-January.
Falling for scammers.
Every year, watch out for scammers during the tax season. Specifically, the IRS cautions against the following:
- Text messages scams that falsely claim to be sent by the IRS. Remember that besides IRS Secure Access, “the IRS does not use text messages to discuss personal tax issues, such as those involving bills or refunds. The IRS also will not send taxpayers messages via social media platforms.”
- Email phishing scams, which occur when you receive an unsolicited email asking for personal and financial information. Again, the IRS states it will not initiate contact with you via email to request this type of information.
- Phone call scams. If you receive an urgent or threatening voicemail urging you to call back or make a payment or else you’ll be arrested, it’s not the IRS. Instead, the IRS will mail you a bill if you owe any taxes you have not paid.
- Unemployment fraud. If you start to receive unemployment or other benefit payments but you never applied for them, you may be a victim of identity theft. Report the fraud immediately by visiting the Department of Labor website.
Not dotting your i’s and crossing your t’s.
The most common mistakes are often the ones that just take a little bit of added attention and effort. In other words, double check your work. According to the IRS, these are some of the errors that people most commonly miss:
- Misspelling names, including your own (yep, it happens)
- Math mistakes (there’s no shame in using a calculator)
- Messing up or forgetting to include your SSN (need to give mom or dad a call?)
- Choosing the wrong filing status (visit the IRS website for assistance)
- Inputting the wrong bank account number (wrong number = delayed tax refund)
- Not signing the form (or not both signing when filing jointly with a spouse)
For more advice, visit the IRS website for a checklist of common errors to avoid.
Find the best tax preparer in your neighborhood.
More ways to come out ahead on Tax Day.
That shoebox full of receipts seemed like a totally reasonable way to keep your track of your annual finances back in September. But now that it’s tax time, your go-to “organizational” methods may not cut it. Use these tips to stay on top of your taxes this year.
1. Get your paperwork in order.
Whether you're doing your own taxes or working with a qualified tax preparer, you should collect everything ahead of time in an organized and sensible way. That includes your SSN (or individual taxpayer identification number if you’re not a U.S. citizen), IRS forms, bank account number and any employer tax forms.
Before you start filling out forms, make a list of everything you need so you don’t forget any important paperwork.
2. Know your filing status, dependents and exemptions.
How you file your taxes changes depending on your marital status and dependents. Before you begin the process, figure out your filing status (single, married filing jointly, head of household or widowed).
Based on your income, you might be able to claim a personal exemption and exemptions for your dependents up to a fixed amount of money. Talk to a tax preparer to find out if you qualify for a personal exemption.
3. Use the right form (there’s more than one).
There are several forms you’ll need to fill out when you prepare your taxes. The form or forms you use depend mainly on your number of dependents, marital status and citizenship.
How and when you file your state income tax return will depend on the rules within your state. Most state taxes are due in early April, in line with the federal tax calendar. Most online tax programs allow you to file your state and federal taxes at the same time. Or, you can chat with a tax expert in your local area.
How much does tax preparation cost?
You can hire a tax pro to help you, your household or your business. Tax professionals are especially useful if you have children or dependents, worked in more than one state last year, rent your home, are self-employed or work as a contractor, own stock or pay out-of-pocket medical fees. So, pretty much everyone.
Some tax preparation companies offer set rates based on the filing bracket you fall into. That means that, regardless of the specifics, you pay the same fee as everyone else in your bracket.
Other companies offer flat-rate pricing that includes joint tax returns, small businesses, rental properties and e-filing. Many tax professionals charge an additional fee for filing your state income tax, though some include the state income tax filing fee in their total quote.
Don’t wait — tax prep companies often charge more for last-minute requests. Planning ahead is one way to reduce additional fees.
For more on costs, see “How much does tax preparation cost?”
Compare prices from tax preparers near you.
Who to hire to help with filing taxes.
You pull that calculator out once a year — and feel that same mix of panic and dread every time you do. Look for these pros to help you sort through those receipts and file on time:
Pro tip: Make sure whoever you hire has the proper credentials as outlined by the IRS.
Thumbtack does not provide tax, legal or accounting advice. This article has been prepared for informational purposes only. This article isn't intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction.