Avoiding Common Income Tax Filing Mistakes
By: Lauren MacDonough
Updated: March 14, 2011
Here are some common mistakes made when people file their income tax returns. CPA David Young joins News 8's Tina Shively to talk about how to avoid them.
Common Mistakes Made When Filing Income Tax Returns
1. Incorrect filing status recorded
a. One of the most common mistakes I see is people filing as single taxpayers when they qualify for the much-more-favorable head-of-household (HOH) filing status.
b. Say you're single and your non-adult child lives with you and pays for less than half of his or her own support. If you pay more than half the household's costs, you qualify. You may also qualify if you are still married and lived with your child but apart from your spouse for at least the last half of 2010.
2. Math errors (according to the IRS, a math error is an incorrect number entered on the return - with or without a calculation)
3. Social security number(s) incorrect, missing or don't match name(s)
4. Incorrect or missing forms and schedules
5. Return not signed
6. Claiming ineligible dependents
7. Failing to claim credits (Child Tax Credit, Earned Income Credit, etc.) or figuring credits incorrectly (because of not understanding credit eligibility or incorrect calculations)
8. Failure to take into account new tax laws, such as
a. Energy Tax Credits.
b. Home Buyers Tax Credits.
c. Making Work Pay Credit.
9. Failure to report and pay domestic payroll taxes (if you are employing a housecleaner, in-home caregiver, nanny, etc.)
10. Forgetting to claim income that's not included on a Form W-2, Form 1099 or other return
11. Not filing a return when due a refund
12. Failing to figure whether or not you're liable for the Alternative Minimum Tax (AMT)
13. Entering the wrong amount of taxable Social Security benefits
14. Mailing your return to the wrong address
15. Standard deduction used when itemizing is more advantageous (the GAO estimates that more than 500,000 taxpayers could save by itemizing)
Common Mistakes Made When Filing Income Tax Returns
1. Incorrect filing status recorded
a. One of the most common mistakes I see is people filing as single taxpayers when they qualify for the much-more-favorable head-of-household (HOH) filing status.
b. Say you're single and your non-adult child lives with you and pays for less than half of his or her own support. If you pay more than half the household's costs, you qualify. You may also qualify if you are still married and lived with your child but apart from your spouse for at least the last half of 2010.
2. Math errors (according to the IRS, a math error is an incorrect number entered on the return - with or without a calculation)
3. Social security number(s) incorrect, missing or don't match name(s)
4. Incorrect or missing forms and schedules
5. Return not signed
6. Claiming ineligible dependents
7. Failing to claim credits (Child Tax Credit, Earned Income Credit, etc.) or figuring credits incorrectly (because of not understanding credit eligibility or incorrect calculations)
8. Failure to take into account new tax laws, such as
a. Energy Tax Credits.
b. Home Buyers Tax Credits.
c. Making Work Pay Credit.
9. Failure to report and pay domestic payroll taxes (if you are employing a housecleaner, in-home caregiver, nanny, etc.)
10. Forgetting to claim income that's not included on a Form W-2, Form 1099 or other return
11. Not filing a return when due a refund
12. Failing to figure whether or not you're liable for the Alternative Minimum Tax (AMT)
13. Entering the wrong amount of taxable Social Security benefits
14. Mailing your return to the wrong address
15. Standard deduction used when itemizing is more advantageous (the GAO estimates that more than 500,000 taxpayers could save by itemizing)
