It’s officially tax season again, and people from around the country are scrambling to finish their taxes. Tax time can be pretty stressful for the average person, and it’s pretty easy to see why. Going through a year’s worth of receipts, claims, and other financial information can be hard, and when you’re sorting through a lot of information, it can be easy to make a mistake or overlook something. Everybody makes mistakes, but the government isn’t as forgiving as most people are. A missing signature, an absent claim, or any other seemingly small mistake can cause an audit, and accusations of tax evasion, and other serious problems. Don’t let yourself get in trouble over a simple mistake – make sure that you avoid these common errors:
Improperly claiming dependents
On the surface, claiming a dependent can seem pretty simple. A dependent is someone who depends on you financially, usually a spouse or a child. If you’ve been through a divorce or have remarried, this deceptively simple declaration can start to get tricky. If you meet certain criteria, you may be able to claim a significant other and their child as a dependent. If you think that you may be able to claim someone as a dependent, but aren’t 100% sure, speak with someone from the IRS or an experienced accountant to see if the person in question qualifies.
Not reporting name changes
This one mostly applies to people who have recently gotten married. Make sure that the IRS is aware of any changes you have made to your name in the last year. If the name of a taxpayer, their spouse, or their children doesn’t match the tax identification number that the Social Security Administration has on record, it will significantly slow down the processing of your tax return. Alert the Social Security Administration of any name changes you have made as soon as possible so that your new name won’t cause problems when you file your first official joint tax return.
Miscalculating charitable contributions
All charities aren’t created equal, and every charity you donate to may not be tax deductible. If you’re giving to charity for tax purposes, save yourself a lot of future trouble and make sure that the organization has tax exempt status with the IRS. Also, make sure that you’re estimating the correct value of the items that you’ve donated. Many people mistakenly write down the amount of money they paid for the donated item, and not the item’s current value.