Avoid Common Tax Filing Mistakes

As with time-honored tax-saving strategies, there are common tax-filing mistakes that seem to snag taxpayers year in and year out, regardless of the changing tax code.

Filing the wrong tax status or overlooking certain exemptions.

Failing to contribute after the tax year ends. Depending on the account, you may still be able to contribute as late as your tax return filing date, or even later.  

Using the IRS as a savings account. Many taxpayers, consciously or unconsciously, have too much withheld from their paycheck for income taxes. Some think of it as a forced way to save. But the IRS doesn't pay interest on refunds. Adjust your withholding and invest the savings from each paycheck.

Assuming you don't have to pay the alternative minimum tax (AMT). Congress designed the AMT to ensure that high-income earners did not escape paying federal income taxes by taking excessive advantage of numerous tax breaks. But the AMT is snaring more and more middle-income taxpayers. You need to calculate your taxes under both sets of rules and pay whichever is the higher amount.

Taking the standard deduction instead of itemizing. A U.S. General Accounting Office study estimated that roughly two million taxpayers overpaid their taxes an average of $500 each by failing to itemize for such things as their mortgage interest and charitable deductions.