Okay, it’s time to get those tax returns in. The IRS has published its list of the most common errors that people make during this time. Although they seem simple, they can really cause a lot of headaches if made.
Valerie RumboughHere goes: Enter Social Security numbers for everyone listed on your tax return exactly as they appear on the Social Security cards. This also goes for the last name of any dependents. Make sure you check the correct filing status, such as Married Filing Jointly, Head of Household, etc.
Review all your math calculations for accuracy. Be sure your bank account number is correct on your return if you elect to have your refund directly deposited. Be sure to sign your return. If you don’t, it’s like an unsigned check – invalid.
If you are filing electronically, be sure to enter the correct Adjusted Gross Income from your prior year’s return. Don’t use the amount from an amended return, if you filed one.
If you have earned income, be sure to claim the Making Work Pay Tax Credit by completing Schedule M. The credit is worth up to $400 for individuals and $800 for married couples filing jointly.
Finally, be sure to have documentation for all your deductions. This is especially true for charitable contributions, both cash and non-cash. The IRS has actually listed charitable deduction fraud on its 2010 Dirty Dozen list.
Finally, if you haven’t filed yet, don’t put it off. Errors can be made when trying to rush through. Remember, be thankful if you have to pay taxes. Many people don’t have income.
Rumbough, CPA, CFP, is chief operations officer with the Baptist Foundation of South Carolina. Contact her at 800-723-7242. In accordance with IRS Circular 230, any U.S. federal tax advice contained in this communication is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing, or recommending to another party any transaction or matter addressed herein.