You work so hard to get all of your receipts and information together to file your tax return. Don't blow it by making any one of these most common mistakes -- mistakes that could red flag your return for the dreaded tax audit!
MESSED-UP MATH: Double check your arithmetic. Math errors are not limited only to miscalculations. They could also be truncated numbers. Negative numbers need to have brackets around them.
SLOPPY RECORDS: If you itemize your deductions, they need to be documented carefully. If you are self-employed, don't be tempted to blur the line between personal and business expenses, especially mileage deductions and home-office usage.
MISSING
| ending odometer readings, location and reason for the trip. |
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MILEAGE: Make sure your records are detailed, with beginning and
Updating logs daily ensures the most accurate information.
OVERSTATING CONTRIBUTIONS: Charitable deductions that are more generous than the IRS' average guidelines are red flags. Overcome this by attaching detailed documentation of your donation and valuation.
WRONG TAX FIGURES: If you are preparing your own taxes, be sure to pull the correct numbers off the tax tables.
INCORRECT ID: The most common mistakes, according to the IRS, have to do with Social Security numbers. Make sure they are accurate and match the name(s) given.
FORGETTING ALIMONY: Another common error is not reporting taxable alimony payments. The IRS tracks payments made from one party to the income reported by the other party to make sure they match up.
MISSING ATTACHMENTS: Attaching the required documentation, such as W2s and 1099s, is critical. All necessary forms and schedules should be included with sequence order given in the upper-right-hand corner.
NO PAYMENT ENCLOSED: If you owe money, make sure you remember to include payment and Form 1040-V. Write your Social Security number and the tax year on the check.
WRONG ACCOUNT NUMBER: If you request direct deposit of a refund, double check to make sure the account and routing numbers for your financial institution are correct.
FAILURE TO SIGN: Above all, be sure to sign your return (both spouses, if filing jointly), and make a copy of it and all supporting documents for your records.
RECEIVING A SIZABLE REFUND: This is not a red flag to signal an audit, but it's a sign that you're making a colossal mistake. It means you overpay your taxes. Part of your paycheck goes missing every payday, and you need to find it. It's stupid to overpay your taxes and then find yourself running to the credit cards because you can't make your paycheck stretch far enough. Fix your withholding. If you want that big annual refund, deposit the difference to a savings account every payday and you'll get your "refund," but with interest, too.