Common Tax Mistakes People Do When Filing (Photo: Yahoo Finance)
Because the process of filing taxes can be intimidating and complex, it’s easy to make a mistake if you’re not careful — and these tax mistakes can cost you money. Read what experts had to say before filing so you don’t miss out on money that could have gone into your refund — or worse, pay fees you shouldn’t have to.
1. Loss of Tax Deductions
The director of educator retirement services at LongView Asset Management, Douglas Lynam, said bad bookkeeping is one of the most common tax mistakes. It would be better to make time for bookkeeping at least once a week.
2. Failure to Meet the Filing Deadline
The tax filing deadline is April 18, and you want to take advantage of it.
What happens if you don’t file your taxes on time? So, the news could be better. The penalty for missing the filing deadline makes it one of the primary tax mistakes.
READ ALSO: Tax Filing and What You Need to Know
Common Tax Mistakes People Do When Filing (Photo: 24/7 Wall St.)
3. Concerned About Filing?
“Many taxpayers get stressed when thinking about taxes — they don’t feel confident they can complete and file their tax return themselves. “This is a huge mistake,” said Seth Babb, TaxSlayer’s director of consumer products. “TaxSlayer has spent the last few decades working to ensure taxpayers feel comfortable and confident that they have filed the most accurate tax return while receiving their maximum refund.
4. Putting Off Filing Until the Last Minute
President of Creative Planning, Peter Mallouk, said that the Tax Cuts and Jobs Act’s changes to tax laws had changed the deductibility of certain expenses, such as home mortgage interest, state and local tax payments, and so on.
5. Filing Too Soon
While it is unwise to file taxes late, filing prematurely can be out of the many common tax mistakes.
Gernot Zacke said that filing your tax return before receiving the proper tax reporting documents is one of the most common errors with clients using a DIY solution.
6. Failure to file your taxes at all
Lisa Greene-Lewis, CPA, senior communications manager at TurboTax, said that every year, the IRS reports that it has close to $1 billion in unclaimed tax refunds, with the average refund being around $700 per taxpayer.
READ ALSO: Tax Tips You Need to Know this 2023
