Thursday, March 3, 2011

Common tax return mistakes

10 things to watch for as you prepare your tax return.
  1. Incorrect Social Security numbers or misspelled names
  2. Using incorrect forms and schedules
  3. Wrong filing status
  4. Claiming ineligible dependents
  5. Misapplied Earned Income Credit and Child Tax Credit
  6. Lack of receipts
  7. Failure to report all income
  8. Not checking for Alternative Minimum Tax
  9. Not signing the return – note the taxpayer and the spouse must sign and date the tax return
  10. Not attaching Form W-2 and other forms that indicate taxes withheld during the year
Bonus items:
  1. Applying for a Refund Anticipation Loan (RAL) without W-2 Earned Income
  2. Omitting the Social Security Number or EIN of your caregiver for the Child and Dependent Care Credit
  3. Mailing the tax return to the wrong address. Here is where to mail tax forms.
  4. Making your check payable to the IRS. The correct payee on checks and money orders should be the United States Treasury.
  5. Misreading the income tax tables
  6. Failure to make a copy of the return for the taxpayer's records
  7. Computation errors
  8. Incorrect bank account numbers for Direct Deposit
  9. Insufficient postage on envelopes. Better yet, use registered mail so there is a record that IRS received your tax return especially if you are paying a balance due.
Here are some other suggestions to avoid tax problems.

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