Tax Season Survival Guide — Preventing Common Filing Errors

A plethora of people living in California state find tax preparation a pretty stressful and time-consuming task.

It is so because the tax preparation needs to be done with the utmost care, and even some of the most meticulous individuals end up making mistakes that result in costly penalties, delays in the process, or some missed deductions that could have minimized the overall tax burden.

That is why most people have outsourced tax preparation and let a CPA in Oakland, CA, handle everything related to taxation so that such people can utilize the saved time to focus on the primary work.

Having a good understanding of some common tax filing mistakes is vital to make sure the tax filing process goes smoothly and more accurately. That is what we are going to discuss in this particular blog.

Tax Filing Mistakes to Avoid

When filing a tax, pay close attention to these common errors.

  • Incorrect Personal Information

A basic but pretty common mistake that people often make is providing incorrect personal information. Make sure that the name, address, and social security number are correct and match the information on the tax documents. Any mismatch will result in the whole process getting delayed or rejected returns from the authorized body.

  • Filing Status Errors

People often end up choosing the wrong filing status, which significantly impacts the overall tax liability. There are essentially five filing statuses: single, married filing separately, married filing jointly, qualifying widower, and head of household.

Each of the statuses has different tax rates associated with potential deductions, too, which makes it pretty vital to select the filing status that correctly reflects the situation of the individual.

  • Incorrect Bank Account Numbers

Many taxpayers in California go for direct deposit to receive the refunds faster. But, often, they end up providing the wrong bank account number because of haste or not paying enough attention, which results in refunds getting delayed and even getting deposited in someone else’s account.

It is better to double-check the bank account number to prevent such easily avoidable blunders.

  • Misreporting Income

It is often the case that people do not report all incomes on their tax return, which includes sources like interest, wages, dividends, and earnings from freelance work.

Neglecting or failing to report some income from a part-time or part-time job or forgetting about the 1099 form can trigger an IRS audit. Make sure that all the needed forms and other income documents are available before starting the filing.

  • Overlooking Deductions and Credits

Tax deductions and credits play a significant role in minimizing a person’s tax bill. Deductions and credits are often overlooked, or some people are not aware of all the available deductions and credits, and that lack of knowledge results in a more significant tax burden that could have been minimized merely by applying appropriate deductions and utilizing credits.

Some standard deductions include medical expenses, student loan interest, and charitable donations. Some common credits include EITC or child tax credit.

  • Missing the Filing Deadline

If someone fails to file taxes before the deadline or apply for an extension, it will result in unnecessary penalties and interest on all the unpaid taxes. The final deadline is typically the 15th of April, but it can vary depending on numerous factors. Mark the calendar and start the tax preparation a little early to avoid any last-minute stress.

A CPA Can Be of Great Help!

A plethora of people tend to ignore the significance of a CPA in tax preparation. Still, when they start working on it, they realize the necessity and convenience that a CPA brings to the table, not merely for businesses but for individuals, too.

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