How To Avoid These Most Common Errors In Your Tax Filing

As we approach the income tax filing deadline, folks all over the country are in a mad rush to fill out returns and complete the filing process.  Software for return preparation has helped to resolve a lot of the issues and errors that occur in filing your returns, but still errors occur – there’s no way to completely fool-proof the process.

Below is a list that was published recently by the IRS, as Tax Tip 2011-63, entitled Tax-Time Errors Filers Should Avoid:

Tax-Time Errors Filers Should Avoid

Mistakes on tax returns mean they take longer to process, which in turn may cause your refund to arrive later.  The IRS cautions against these nine common errors so your refund is timely.

  1. Incorrect or missing Social Security Numbers When entering SSNs for anyone listed on your tax return, be sure to enter them exactly as they appear on the Social Security cards.

  2. Incorrect or Misspelling of Dependent’s Last Name When entering a dependent’s last name on your tax return, ensure they are entered exactly as they appear on their Social Security card.

  3. Filing Status Errors Make sure you choose the correct filing status for your situation.  There are five filing statuses: Single, Married Filing Jointly, Married Filing Separately, Head of Household, and Qualifying Widow(er) with Dependent Child.  See Publication 501, Exemptions, Standard Deduction, and Filing Information to determine the filing status that best fits your needs.

  4. Math Errors When preparing paper returns, review all math for accuracy.  Or file electronically; the software does the math for you!

  5. Computation Errors Take your time.  Many taxpayers make mistakes when figuring their taxable income, withholding and estimated tax payments, Earned Income Tax Credit, Standard Deduction for age 65 or over or blind, the taxable amount of Social Security benefits, and the Child and Dependent Care Credit.

  6. Incorrect Bank Account Numbers for Direct Deposit or Debit If you are using direct deposit for a refund or direct debit for a payment, make sure that you review the routing and account numbers for your financial institution.

  7. Forgetting to Sign and Date the Return An unsigned tax return is like an unsigned check – it is invalid.  And, remember on joint returns both taxpayers must sign the return (another item that is not necessary when filing electronically, although electronic signatures are required).

  8. Incorrect Adjusted Gross Income Information Taxpayers filing electronically must sign the return electronically using a Personal Identification Number.  To verify their identity, taxpayers will be prompted to enter their AGI from the originally filed federal income tax return for the prior year, or the PIN number used previously if they used a PIN for the prior year.  Taxpayers should not use an AGI amount from an amended return, Form 1040X, or a math error correction made by the IRS.,/p>

  9. ,p>Claiming the Making Work Pay Tax Credit Taxpayers who file Form 1040 or 1040A will use Schedule M to figure the Making Work Pay Tax Credit.  Completeing Schedule M will help taxpayers determine whether they have already received the full credit in their paycheck or are due more money as a result of the credit.  Taxpayers who file Form 1040-EZ should use the worksheet for Line 8 on the back of the 1040-EZ to figure their Making Work Pay Credit.


IRS CIRCULAR 230 NOTICE: To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. tax advice contained in this communication (or in any attachment) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed in this communication (or in any attachment).


About the author

Jim Blankenship, CFP®, EA

Jim Blankenship is the founder and principal of Blankenship Financial Planning, Ltd., a financial planning firm providing hourly, as-needed financial planning and advice. A financial services professional for over 25 years, Jim is a CFP professional and has earned the Enrolled Agent designation, a designation that qualifies him as enrolled to practice before the IRS. Jim is also a NAPFA-registered financial advisor, which designates him as a Fee-Only Financial Advisor.

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2 Comments

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  • Debbi –

    As long as you had earned income during 2010 you should be eligible for the MWP credit. I don’t know of a reason that your pension would disqualify this.

    jb

  • I received a public employment pension in Ohio effective May, 2009. I claimed and received a Government Retiree Credit on my 2009 Federal Income Taxes. I continued to receive a public employment pension in Ohio for the entire year of 2010. In addition to my pension, I had earned income. Am I eligible for a Making Work Pay Credit for earned income in 2010? I have studied the IRS website/publications and Schedule M. None of these address this situation. Thank you for any assistance you can provide.

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