Mistakes are all too common on tax returns in the United States, and you may experience IRS problems whether your taxes are incredibly complicated or are rather simple. Here are some of the most common IRS problems you may experience and how to avoid them.
Incorrect Income Reporting
One of the most common mistakes seen at tax time is the underreporting of income. If you’re an independent contractor and you receive payments from several businesses, you may forget to include the money from one of those sources of income.
If you only make a few hundred dollars from one company and much more from other companies, you might forget to include the income, particularly if that small business didn’t submit a 1099.
Tip: If you’re an independent contractor and make less than $600 from one of the businesses you work with, that business doesn’t have to submit a 1099 to the government indicating that they paid you. However, it’s still your responsibility to report that income to the IRS at tax time.
Mistakes the IRS Commonly Sees on Tax Returns
One of the best ways to avoid IRS problems is to understand what mistakes are common so that you can avoid them. Conveniently, the IRS has published a list of recommendations for tax time that can help you avoid making mistakes.
Tips for tax time include reporting all income, using the online tools from the official IRS.gov site, and review the return before you submit it. One of the best reasons to review your tax return and make sure it’s accurate is because mistakes can prevent you from getting your refund in a timely manner.
“Mistakes slow down your tax refund. If you file a paper return, be sure to check all Social Security numbers. That’s one of the most common errors. Remember that IRS e-file is the most accurate way to file.”
The IRS also recommends conducting a little research on your filing options. The complexity of your taxes might require a trip to an official tax preparation business, or you might consider speaking with a Certified Public Accountant. You may even qualify for free assistance for preparing your taxes.
What are Some Other IRS Tax Problems?
There are all sorts of tax problems you may experience if you don’t make sure to check and recheck your taxes. But an awareness of the following possible mistakes can help you avoid them.
- Failing to file a tax return – this one might seem obvious, but it’s common to forget about tax day until it’s passed by a few days or weeks. It’s important to file your taxes as soon as you realize you forgot to file, so you don’t have to deal with substantial penalties.
- Making a mistake on name or address – you probably know someone who’s transposed a few numbers on their tax return and has paid the price because of that error. Another common error is making a mistake on the social security number entered into the form. Transposing just a few numbers can result in a huge hassle when the IRS rejects the tax return.
Are You Experiencing IRS Problems This Year?
Are you worried about a mistake on your taxes? Has the IRS contacted you about penalties and fees relating to a tax problem? Let the experienced legal team at Suburban Legal assist you as you navigate the difficulties of federal income taxes.
DISCLAIMER: All information on this website are provided for informational purposes only and are not intended to be construed as legal advice. Suburban Legal Group PC shall not be liable for any errors or inaccuracies contained herein, or any actions taken in reliance thereon.