Errors to Avoid when Filing your tax Return
The best way to avoid errors on your tax return is to file your return electronically instead of filing a paper return. An electronically filed return is less likely to have math errors or missing information as the tax preparation software does the math, flags common errors and prompts a user to enter missing information. By reducing these common mistakes not only will the IRS process your return faster, but it reduces the likelihood that the IRS will contact you to clear up the errors.
No matter what method you are using to file your tax return, it is important that you double check your entries. The most common errors to avoid are:
- Missing or inaccurate social security numbers: It is important that the taxpayer’s social security number appear exactly as it does on the social security card.
- Misspelled names: The name(s) listed on the tax return should match the name on the person’s social security card. This includes the names of children and other dependents.
- Filing status: Make sure you have chosen the correct filing status (single, married filing jointly/separately or head of household).
- Math errors: These are the most common mistakes. Software will prevent these types of errors since it will make the computations automatically. However, the software will only be accurate if the information you input into the system is accurate. Thus, it is important to review to make sure you did not transpose numbers or make other typographical errors.
- Credits and deductions: Do not forget to consider all deductions or credits to which you may be entitled. Although in many cases the standard deduction will be higher than itemizing, it is important that you enter the information regarding the itemized deductions to actually determine which is the higher of the two. If you use software and enter all the information, the software will make this calculation for you.
- Incorrect bank account numbers: The fastest way to get your refund is to have it directly deposited into your bank account. It is very important that you input the correct routing and bank account number on your return if you want to use direct deposit. If you are using software, it will generally use the banking information you entered the prior year. Make sure to verify that this information has not changed.
- Unsigned forms: A return is not valid unless it is signed. If it is a joint return both spouses must sign the form. Filing a return electronically gets rid of the possibility that a return will not be signed. An electronic return is digitally signed and the system will not allow the return to be filed until you input the information necessary to constitute a digital signature.
- Individual tax identification number (ITIN): If a taxpayer is using an ITIN to file a return, and the number has expired, the IRS will accept and process the return. However, any exemptions or credits claimed on the return will not be allowed until the taxpayer renews the ITIN.
- Victims of identity theft (IP PIN): If the IRS’s records show that you were the victim of identity theft or are identified by the IRS as a possible victim of identity theft, the IRS will issue an IP PIN to authenticate your identity when you file your return. It this applies to you it is important that you include the number on the return and that the number be accurate. The IRS issues a new IP PIN each year. If you file your return electronically, it will be rejected by the IRS if you do not enter the correct IP PIN on your return. If you are filing a paper return and fail to enter the IP PIN correctly, the return will take longer to process as the IRS will have to validate you return.