Tax problems can sneak up on anybody, and it won’t take long for those unfortunate situations to spiral out of control. That is why everyone should be
Tax problems can sneak up on anybody, and it won’t take long for those unfortunate situations to spiral out of control. That is why everyone should be aware of some of the most common tax issues and what can be done to correct them.
Millions of people file their taxes late every single year, and that can lead to some serious complications. If you filed late and are expecting a refund, then there shouldn’t be any penalties. Those who are going to owe taxes after filing should submit their forms as soon as possible to avoid penalties and interest.
You Miscalculated Your Deductions
This one is pretty common, especially if you have a lot of deductions. The best way to avoid this issue is to use a tax calculator or speak to a tax professional ahead of time so you can get an estimate of what you’ll owe. That way, you can budget accordingly and avoid any surprises come tax season.
Failing to file your taxes is another common mistake that can impact many facets of your life. Anyone who has forgotten to file their taxes for one or more years should contact a company like IRS Trouble Solvers, LLC. They will be able to look over your information and help you come up with a plan for filing old paperwork so that you aren’t stuck with huge penalties.
You Forgot to File a Key Form
There are a lot of different forms that need to be filed along with your taxes, and it can be easy to forget one. If you realize you’ve forgotten a form, don’t panic! Just file an amended return as soon as possible and include the missing form (you may need to pay a penalty for filing late, but it’s better than being audited).
You Made a Math Error
We’re all human, and sometimes we make mistakes. If you notice a math error on your return after you’ve already filed, don’t worry! Just file an amended return with the corrected information. The IRS will refund any overpayment, plus any interest you may be owed.
You Didn’t Receive All of Your 1099 Forms
The IRS requires businesses to provide 1099 forms to anyone they’ve paid $600 or more to over the course of the year (this includes contractors, rental property owners, and interest payments). If you’re missing a 1099 form, reach out to the company in question and ask them to send you another one. In the meantime, include any relevant information on your return (such as estimated income) and update it once you receive the missing form.
Mistakes on Your Forms
Filing your taxes can be a confusing process, and it won’t take much to make a mistake on your forms. Luckily, fixing this mistake is relatively easy, and all you are going to need is the 1040-X form. That form will allow you to amend your information if there are any changes to your income, credits, deductions, or status.
Filing for the Wrong Status
This is another common issue that many people run into that can easily be taken care of with the 1040-X form. As soon as you notice any issues with your tax information, you should download that form so that you can rectify the situation. As long as the information is quickly amended, you usually won’t incur any fines or fees.
In most cases, those who overpay on their taxes will simply be given a refund for the excess amount. If you aren’t given a refund, then you will most likely want to contact a tax lawyer to explore your options. Depending on the total amount of the refund, you can either have the refund deposited into your account or applied to your taxes the following year.
While some of these issues might seem daunting at first, they can often be easily taken care of as long as you act immediately. For larger tax problems, you should always contact an attorney who has quite a bit of experience with personal finances and tax laws.