It’s something not many of us look forward to–filing tax each year. Each April, tax time rolls around, with many of us scrambling to get our taxes filed on time.
However, if you’re not careful, it’s easy to make mistakes when filing, leading to costly tax problems. If your paperwork isn’t done correctly, it can lead not only to delays in getting your refund, but also in fines.
To learn more, keep reading to find four common tax problems—plus, how to avoid them.
1. Not Filling Out Tax Forms Correctly
Whether you’re filing online or using paper forms, it’s easy to make mistakes on tax forms. The required IRS forms are detailed, complex, and confusing, if you’re not paying close attention.
Take care to avoid entering your SSN incorrectly, forgetting to sign each form, or making a mistake when entering your bank details—essential for your refund!
Instead of trying to figure out the tax paperwork on your own, work with a tax expert like https://wealthability.com/tax-services/ to ensure you’ve filed everything correctly.
2. Missing Key Deductions
It’s likely that you qualify for more tax deductions than you might realize. One of the most common tax mistakes is missing out on key deductions.
While not technically an error, it is a big issue, as you’re cheating yourself out of a refund.
Be sure to familiarize yourself with all tax deductions that you can qualify for, such as IRA contributions, interest from your student loans, and any charitable donations you made during the year.
3. Filing Late
The IRS isn’t joking when it comes to deadlines. Don’t file your taxes late, as you might be subject to fines and penalties.
Generally, the tax deadline is April 15th, although there are exceptions in special circumstances, like if you live overseas.
4. Forgetting to Declare All of Your Income
The government depends on income tax to fund essential programs and services, so they don’t take kindly to under-reporting. Under the law, you’re required to declare all of your income.
This includes income from hobby or side businesses, as even if it’s not your main source of income, it’s still taxable. If you’re ever unsure about what income is taxable, it’s best to talk to a qualified accountant.
Avoid These Tax Problems to Stay on the Right Side of the IRS
As responsible citizens, we need to pay tax each year—whether we like it or not! To get the process done as easily as possible, take care to avoid these common tax problems.
The best way to avoid tax issues is by staying organized, keeping track of all of your paperwork and tax forms. Working with a tax accountant can help too, as it takes away the stress of doing it yourself.
Get started today and before you know it, you’ll be done with your taxes for another year!
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