Avoid Common Tax Preparation Mistakes

Pulling out your receipts, calculating interest, and making sure you have your W-2 forms at hand, can be tiring at tax time. You are bound to overlook something or make some little mistake. The only problem is that a little mistake can cost you a lot when it comes down to preparing your tax income tax return. What you need is a checklist of the most common tax preparation mistakes to avoid.

•Avoid math errors. Small math errors can be costly when preparing your income tax return. Review the entire math until you are absolutely positive that it is one hundred percent correct. Just moving a decimal point or inadvertently adding a zero could cause grave consequences.

•List all your employers. If you worked more than one job, be certain that you include all of them on your return. If you forget about an employment source, you could be charged with income tax evasion.

•Avoid miscalculating charitable amounts. Charitable giving is deductible on your income tax, but be certain to list all charities correctly so you will receive the proper credit. The Internal Revenue Service has become very circumspect in recent years in regard to charitable deductions.

•Always list your marital status as it currently stands. If you are in the process of getting a divorce, you are not yet divorced. Technically, your filing status is still married until the divorce is finalized.

•Childcare costs are deductible on your income tax return. Make certain that you qualify for all the deductions and credits you claim for childcare. Don't forget any for which you are qualified, either. Childcare credits can markedly reduce your tax liability. You do not want to file a claim for credits or deductions to which you are not entitled or miss any you should receive.

•The Internal Revenue Service knows about your unearned income. They can monitor your bank accounts, so be sure to report unearned income and don't forget any large amounts of it on your tax return.

•Do not miss the April 15 deadline without filing an extension. You can get a six-month extension with no penalty, but you have to file for it. It is not automatic, supposing you simply do not send in a return.

•Do not forget to sign your return. It's a legal document requiring your signature. It might be surprising, how many people forget to sign. I don't know the number, but it is reportedly high.

Preparing and submitting your tax return is a nightmare especially when the deadline is approaching fast. You are bound to make mistakes in a hurry, resulting in tax liabilities. How to avoid simple mistakes to make you life a bit easy? Chintamani Abhyankar explains in this article.

Chintamani Abhyankar, is a well known expert in the field of finance and taxation for last 25 years. He has written many books explaining inside secrets of the magic world of personal finance. His famous eBook Stop donating your money to IRS which is now running in its second edition, provides intricate knowledge and valuable tips on personal finance and income tax.