Tax Tips from the Tax Lady
Top 10 tips for preparing your return:
- Clean, correct, current and complete. Use good recordkeeping habits and a computer to complete your return and you will have gotten yourself off to a fabulous start.
- Right forms in the right order. Using the right forms and putting them in Sequential order makes it easier for the IRS to quickly read and review – which is what you want!
- Use the correct filing status. The wrong tax category could cost you plenty in credits and deductions.
- Claim all of your allowable exemptions. At $3,500 per exemption, that is a pretty penny to kiss away.
- Don’t use round numbers. Rounded numbers is a big red flag that the taxpayer is estimating the numbers and may increase your chance for an audit.
- Double check your math. Make sure to pay special attention to the Earned Income tax credit and Child tax credit—they are most often calculated incorrectly.
- Sign your return. Yes, it seems like an obvious point. But the IRS says unsigned tax returns are one of the most common taxpayer miscues.
- File and pay on time and avoid penalties. You must pay at least 90% of your tax due by April 15 to avoid penalties.
- If you are not ready, file an extension. File IRS Form 4868 and you will get until October 15 to file and avoid a late filing penalty.
- Keep a copy of your return. For at least 6 years after filing your return, retain a copy just in case.