Most of the common errors taxpayers make on their tax returns are easily avoidable. By carefully reviewing their return, taxpayers can save time and effort by not having to correct it later. Filing electronically also helps prevent mistakes. Tax software does the math, flags common errors and prompts taxpayers for missing information. It can also help taxpayers claim valuable credits and deductions. Taxpayers who qualify may use IRS Free File to file their return electronically for free.
Here are some of the mistakes to avoid:
- Filing too early. While taxpayers should not file late, they also should not file prematurely. They should wait to file until they’re certain they’ve received all their tax reporting documents, or they risk making a mistake that may lead to a processing delay.
- Missing or inaccurate Social Security numbers. Each SSN on a tax return should appear exactly as printed on the Social Security card.
- Misspelled names. The names of all taxpayers and dependents listed on the return should match the names on their Social Security cards.
- Inaccurate information. Taxpayers should carefully enter any wages, dividends, bank interest and other income they received to make sure they report the correct amounts. This includes any information taxpayers need to calculate credits and deductions.
- Incorrect filing status. Some taxpayers choose the wrong filing status. Publication 501 has detailed information about filing statuses.
- Math mistakes. Math errors are some of the most common mistakes. They range from simple addition and subtraction to more complex calculations. Taxpayers should always double check their math. Better yet, tax prep software will check it automatically.
- Figuring credits or deductions. Taxpayers can make mistakes figuring things like their earned income tax credit, child and dependent care credit and child tax credit. Tax software will calculate these credits and deductions and include any required forms and schedules.
- Incorrect bank account numbers. Taxpayers who are due a refund should choose direct deposit. This is the fastest way for them to get their money. However, taxpayers need to make sure they use the correct routing and account numbers on their tax return.
- Unsigned forms. An unsigned tax return isn’t valid. In most cases, both spouses must sign a joint return. Exceptions may apply for members of the armed forces or other taxpayers who have a valid power of attorney.
- Disreputable tax preparers. Taxpayers should remember they, not the tax preparer, are responsible for the information on their tax return. The IRS has resources to help taxpayers find someone to prepare their tax return. Some taxpayers may even be able to get free help from IRS-certified volunteers. Certified public accountants, enrolled agents or other tax professionals can also help taxpayers avoid errors.
Here’s a short checklist to help taxpayers choose a tax preparer for the upcoming filing season
Tax filing season will be here soon. As people begin to gather their documents and receipts in preparation of filing a tax return, many are also choosing to use a professional tax return preparer. Anyone with an IRS Preparer Tax Identification Number can be a paid tax return preparer. However, tax return preparers have differing levels of skills, education and expertise. Choosing a tax return preparer wisely is important because taxpayers are ultimately responsible for all the information on their return, no matter who prepares it for them.
Taxpayers can start their search with the IRS Directory of Preparers
When looking for a tax professional, taxpayers can search the IRS Directory of Preparers. While it is not a complete listing of tax return preparers, it does include those who are enrolled agents, CPAs and attorneys, as well as those who participate in the Annual Filing Season Program.
Before hiring a preparer, taxpayers should make sure they know what they’re getting. They can do this by:
- Checking the preparer’s history with the Better Business Bureau. Taxpayers can also verify an enrolled agent’s status on IRS.gov.
- Asking about fees. Taxpayers should avoid tax return preparers who base their fees on a percentage of the refund or who offer to deposit all or part of their refund into their financial accounts. Taxpayers should be suspicious of any preparer claiming they can get larger refunds than other tax preparers.
- Asking if the preparer plans to use e-file. The fastest way to get a tax refund is by e-filing and choosing direct deposit.
- Making sure the preparer will be available if needed. People should consider whether the individual or firm will be around for months or years after filing the return. It’s possible they’ll need the preparer to answer questions about the preparation of the tax return later.
- Ensuring the preparer signs and includes their PTIN. Paid tax return preparers must have a PTIN to prepare tax returns and must include it on any tax return they prepare.
- Considering the person’s credentials. Only attorneys, CPAs and enrolled agents can represent taxpayers before the IRS in tax matters. Other tax return preparers who participate in the IRS Annual Filing Season Program have limited practice rights to represent taxpayers during audits of returns they prepared.
Choosing a Tax Professional
Tax Time Guide: Free tax return help available in-person and online
Publication 17, Your Federal Income Tax
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Marylanders now have until July 15, 2022, to file and pay 2021 state individual income taxes, Comptroller Peter Franchot announced Wednesday.
Comptroller Franchot said the extended deadline is meant to assist taxpayers facing financial difficulties due to the COVID-19 pandemic. The extension waives penalties and interest on outstanding liabilities.
“Many people are still struggling to stay above water, so giving taxpayers more time to file and pay will hopefully ease their financial pressure,” Franchot said in a statement. “As we approach the two-year mark of the onset of COVID-19, my agency remains as committed as ever to helping Marylanders who still are feeling the pandemic’s impact.”
The Internal Revenue Service, which already has warned of processing delays for the 2022 tax season due to COVID-19, has not indicated any plans to extend the federal income tax filing and payment deadline beyond April 18.