The information in this article is up to date for tax year 2023 (returns filed in 2024).
Making a mistake on your taxes can cost you big. And nobody likes losing money. The good news is using a tax program like ezTaxReturn can help you get your taxes right. Here are some tax filing mistakes that can cost you money.
Choosing the wrong tax filing status
Your filing status affects your standard deduction, the credits you can claim and ultimately, the amount of taxes you owe. Making the mistake of choosing the wrong tax filing status can cost you thousands of dollars. Head of household is a good option for most single parents because it saves you more money. The 2023 standard deduction for single filers is only $13,850 whereas it’s $20,800 for those filing head of household. That’s a difference of 6,950. To file as head of household, you must be unmarried, have a dependent and paid more than half the cost of keeping a home for the year.
Missing out on valuable tax credits and deductions
Another mistake tax mistake that can cost you money is missing out on valuable tax breaks. Claiming every credit and deduction you’re eligible for will help you get every dollar you deserve. Except you don’t have time to read through thousands of pages of tax code to know what’s available. That’s where ezTaxReturn comes in. You don’t need any tax knowledge to do your taxes with us. We’ll guide you step-by-step through your return and help you get the biggest possible refund.
Under reporting your income
Whether you’re self-employed or work for someone else, you must report all your income to the IRS. They receive a copy of the same income statements sent to you so don’t waste your time trying to leave anything out.
Messing up the math
Add lines 1, 2b, and 3b then subtract line 10c. Confused yet? Miscalculations are one of the biggest mistakes people make when doing their taxes by hand. So, put away your pencil and paper and use tax software instead. ezTaxReturn does the math for you and guarantees 100% accurate results based on your entries.
Entering the wrong direct deposit information
Direct deposit is the fastest way to get your refund, but not if you enter the wrong bank information. So, always double check your account and routing numbers before submitting your tax return. If you miss a digit and your bank rejects the deposit, the IRS will usually issue a paper check to the address listed on your return. Unfortunately, not everyone is so lucky. If you enter an account number that belongs to someone else, you’ll need to work with your bank to get your money back.
Ignoring the tax deadline
Your taxes are due on April 15th unless you request an extension. If you owe the IRS and miss the deadline, you’ll begin accumulating penalties and interest. The penalty for failing to file is 5% of your unpaid taxes for each month it’s late. If your return is more than 60 days late, the minimum penalty is $485 or 100% of your unpaid taxes, whichever is lower. The penalty for paying late starts at 0.5% of your unpaid taxes and can climb up to 25%.
Not preparing a tax return at all
Even if you think you didn’t earn enough money to file, prepare a return anyway. You may qualify for a refundable credit and be due a refund. The Earned Income Tax Credit is designed specifically for low-income earners and is worth up to $7,430. Start your return now with ezTaxReturn so you don’t miss out.
Misunderstanding how a tax extension works
If you need more time to prepare a return, you must request an extension by April 15th. Just keep in mind that an extension only gives you more time to file a return, it doesn’t give you more time to settle your tax bill. Even if you can’t cover the entire amount at least pay as much as you can by Tax Day to minimize the fees and interest.
Spending more than necessary to file a tax return
Why spend big bucks on something you can get for free? If you have a basic tax situation, you can file a FREE simple federal return at ezTaxReturn.com. It’s the fastest and easiest way to get the biggest possible refund. So, start now.
The articles and content published on this blog are provided for informational purposes only. The information presented is not intended to be, and should not be taken as, legal, financial, or professional advice. Readers are advised to seek appropriate professional guidance and conduct their own due diligence before making any decisions based on the information provided.