Paying tax is one of the hardest things people do. This should however, not sting so much that you forfeit the opportunity to save some money. When filing taxes, most people do not get the actual refund they are entitled to due to carelessness or ignorance.
Equally, do not be overambitious with maximizing your refund by so much that it grabs the tax man’s attention. Here are some tips given by tax experts:
Double check for errors
A lot of people miss items on their refund, or end up with more tax due than they ought to pay. You can’t imagine that you could misspell your own name or those of your family, but the IRS reported a rise in these errors. Ensure that your sums are okay, and that there are no mathematical errors.
Another thing is to check that you have entered the correct figures. If your mistakes involve a lot of understatements, IRS will not be smelling mistakes but rather mischief. Then confirm that you include all exemptions that you wish to apply for.
A good number of people will find out they left out things after filing. This happens mostly due filing at the 11th hour, which leads as to the next tip.
Be an early filer
The tax deadline eve is not the perfect day to be queuing at the post office. Besides the fact that it is hectic, it is also the reason why many people do a shoddy job with their tax filing.
File your taxes in time
By filing on time, you allow yourself to go through the document without having to rush. You can also correct mistakes, ensure accurate figures and review your deductions list this way. Recently, there has been an issue of fraudsters filing for refunds using other people’s Social Security numbers. These troublemakers file early with the hopes of doing so before the real taxpayer. This way they seek to have the refund check directed to them instead. The IRS reported that it encountered about 3 million frauds last year.
Filing early will help to a great extent with this. Avoid the scrutiny of audits and being penalised While optimizing your refunds is ideal, do not try cheating the government. It will cost you more that you willed to pay. Apply for deductions that you are entitled to.
Several items will always call for the tax-man’s attention. One is a total zero; you owe nothing and you are being owed nothing. It is a great achievement if that it is the truth. However, if you are going behind the IRS’ back, then you will get yourself in big trouble if audited. The statute of limitations also allows the IRS to investigate taxes for several years following the filing. Another red flag is child adoption expenses; these save you a big on taxes, but do not engage in mischief with them.
Also, be careful when applying for capital deductions. This is especially the case if they appear large and are included in tax filings every year. An audit will expose you to the keen eye of the taxman. Penalties will cost you more than double the amount you should have paid. Even if a refund was due, discovery of a tax fraud will take all that you wanted to save.
With all the available tax filing options such as filing online, applying for extensions and hiring experts, there is no valid reason to not file your taxes. Online tax filing also enables you to monitor your progress instead of waiting for a reply from the post office.
Do not leave your tax filing for another year because you are piling on trouble if you do. If you can’t meet the deadline, file for an extension; it is better than skipping. Just remember it is an extension not an extinction of your tax troubles. Finally, if you are not savvy with tax matters, go to the experts and have them do a good job for you.