Whether you’re just getting started on your tax return or if it’s almost complete, it pays to take a few minutes to make sure you haven’t missed anything.
Review all Social Security numbers on your return
Despite the complexities of the tax code, the IRS says one of the most common mistakes on tax returns is very simple.
Taxpayers enter incorrect Social Security numbers, or they enter Social Security numbers that do not match names associated with those numbers.
Double-check your Social Security number on your return, and that of your spouse if you file jointly.
Don’t forget to enter correct numbers for each child – they must be correct to take a dependency exemption or qualify for other tax breaks.
The only exception to the Social Security number requirement is if the child was born and died in the same year.
Make sure each child’s name is spelled exactly as on his or her Social Security card.
Remember the ACA penalties
If you don’t have health insurance coverage for all of 2016 or qualify for an exemption, you will be assessed the Individual Shared Responsibility Payment. That penalty is 2.5 percent of your yearly household income or $695 per adult, whichever is higher.
The penalty applies to uncovered individuals who don’t qualify for an exemption – and it is a per person penalty.
If you have a family and each member isn’t sufficiently covered, you are responsible to pay the penalty for yourself, your spouse and all of your dependents. The maximum penalty per family is three times the per-person flat-dollar penalty, or $2,085.
Consider contributing to a retirement fund
It’s not too late to make a contribution to many types of retirement funds. The deadlines for making a contribution vary.
For example, you can contribute to a traditional or Roth IRA up to the due date of your return, not including extensions. That’s April 18, 2017 for the 2016 tax year.
For SEP IRAs and SIMPLE IRAs, you can contribute to a plan up to the return due date for the year, including extensions.
Review, review, review
There’s no substitute for carefully reviewing your tax return before filing.
First, if you use DIY tax software like TaxAct, be sure to review all TaxAct Alerts to help find errors and missing information.
- Red alerts identify incomplete or inconsistent information.
- Yellow alerts identify potential problems.
- Green alerts point out potential tax savings.
Also, make sure you print and read your finished tax return. It’s always a good idea to completely understand your return before you file.
If you didn’t get a deduction or credit you expected, go through that section of the step-by-step interview again and review your answers.
Lastly, check your income to ensure you haven’t entered the same income more than one place – it happens!