3 Sets of Silly Mistakes we Make with Taxes and Tax Returns

The last two years, I’ve been doing my taxes myself. This year will be no different. There are certainly risks in doing your own taxes, so if you don’t understand the laws, you should get someone to look at your return before sending it out.

When people are unsure and send anyway, they make some really big mistakes. Other people make mistakes when they get their returns. Here are three sets of silly mistakes that people sometimes make when doing their own taxes.

Three mistakes we make when we file.

1. Filing the wrong status. What matters? Your marital status as of December 31st. It doesn’t matter if you just got married on December 10th, if you’re married on December 31st, that’s your filing status. If you do this incorrectly, you risk losing child tax credits and other family-based deductions that you would otherwise have.

2. Not reporting certain incomes. Waitressing tips, casino winnings over $1000, and anything paid “under the table” or via freelancing needs to be reported and taxes paid on. The fines and fees for not doing this, no matter how small the error, are immense. Don’t risk it.

3. Social security numbers. I was in college twice. I know my social security number by heart. But, nowadays, this isn’t as commonplace as it used to be. Make sure that you write it neatly if you’re still doing your taxes by hand. If you aren’t 100% sure about your dependent’s social security number, ask them or find their card. It’s not worth the pain it is to refile.

Two silly things we do with our tax return

1. Spend instead of invest. Some people have a plan for their tax return, and that’s good, but you should also invest a bit of it as well. That money is money of yours that the government borrowed for the year, meaning that they got interest that you should have gotten. So, why not work to get some of that interest back?

2. Furthering debt instead of paying debt down. How is this possible? Well, some people use their return to make big purchases that they have to take out loans and/or use credit in order to make. Don’t do this! You should consider paying down your debt instead.

One thing we don’t do enough

1. Get organized beforehand. Too many people (myself included) wait until tax season to finally get all of theirĀ receiptsĀ and pay stubs together. Even if your system of organization involves throwing all of your stuff into a shoebox and dealing with it at the beginning of the year, that’s better than having to tear your house apart for that one medical receipt that you really want to claim.

So, avoid making these tax mistakes this coming year. Start throwing your stuff together for next year. Your plan for your tax return should include some investments. And most of all, check everything before you hit that submit button. Have a great week!

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