When the filing deadline is closing in, mistakes can happen as many of us are scrambling to get in before it’s too late. Preparing your tax documents too quickly can be dangerous and lead to just such costly oversights and errors. Here is a list of some of the most common mistakes people make when filing. Here’s hoping it saves you from a headache or two!
1. Forgetting to claim a car donation deduction:
If you donated a car to a reputable car donation charity, you won’t want to forget to claim that deduction. Not sure if you are eligible? Want to know what information you’ll need to provide? Kars4Kids has created an easy-to-understand handy Accountants Guide to Car Donation, so you’ll never make a mistake and lose out on that all-important deduction.
2. Forgetting to put a stamp on your envelope:
Every year, thousands of people completely forget the stamp when mailing out their return, or they remember the stamp but use insufficient postage. Luckily, a return that’s a little late will usually incur no more than a small penalty. But better safe than a sorry mistake that costs money you might have saved.
3. Forgetting to sign your return:
Another common mistake is forgetting to sign your return. Unsigned returns are considered by the IRS as if they were never submitted, and the IRS may not notify you for a month or more. By then the penalties and interest may already be adding up.
4. Green Appliances and Home Improvement:
There are many home improvements that are eligible for a tax credit. Things like energy efficient new windows, roofs, HVAC systems and many other improvements may be eligible. Don’t forget to file for this credit–it’s a mistake that many people make when fixing up their homes. See Energy Star for more details.
5. Filing correctly for those home improvements:
If you will be filing for home improvements, Houselogic warns that some items can be very complex to file for. And after you’ve come this far you don’t want to lose out on this credit because of a simple filing error. Take the time to carefully read the directions on the income tax forms.
6. Environmentally-friendly vehicles:
Tax breaks are available for those who purchased an electric or hybrid vehicle during the course of the year. Don’t forget to maximize the benefits of being a good friend of the planet.
7. Federal student loans:
Payments made on federal student loans last year may be eligible for a tax deduction using form 1098-E. Students of the world, this is your big chance, don’t blow it!
8. Private Mortgage Insurance:
If you bought your house with a down payment of less than 20% you were probably required to purchase private mortgage insurance. If your adjusted gross income is less than $109,000 you may be able to deduct those payments, which can add up. Source and more info at Houselogic.
9. Political Tax Credit:
States like Oregon allow you to claim a tax credit for contributions made to a political group. Check if this credit is available in your state as well. If it is, it’s like free money.
10. Save money with free online filing:
If you want to save more money, file online for free. Two of the more popular tools are Turbo Tax, and H&R Block.