Simple mistakes on your tax returns can result in a criminal charge. That’s why taxpayers should be extra careful and be informed about tax laws when filing tax returns.
Below are four errors on your tax returns that can get you into trouble:
1. Math errors
The additions, subtractions and complex calculations involved in tax returns contribute to a significant percentage of errors reported by the Internal Revenue Service (IRS). You should always double-check your calculations or use tax preparation software.
2. Entering information inaccurately
Entering information inaccurately, including personal details, wages, other income received, bank interest and data needed to calculate credits and deductions, is another common mistake taxpayers make. Before filing your tax returns, always confirm every detail you have provided is correct.
3. Filing too early
Filing tax returns earlier can be advantageous, as it allows you to get your refund sooner and saves you from last-minute rushes. Nonetheless, you don’t want to file too early- when you don’t have all the required documents and information. Without the proper documents at hand, you may make a mistake.
Typically, you should have the needed documents early in the year. If you don’t have any, contact your employer or the respective party on time.
4. Choosing the wrong filing status
Some taxpayers usually choose the wrong filing status, especially when more than one filing status applies. Filing status is crucial because it determines the accurate tax, filing requirements, standard deduction and eligibility for certain credits. Thus, choosing the wrong filing status may result in you paying more or facing an audit.
Paying attention to every step you take and employing technological tools can save you from tax return errors. If you are facing a criminal charge due to a mistake on your taxes, legal guidance can help.