IRS Tips to Make Filing Your Tax Return Easy and Avoid Mistakes
Tax season is upon us, and with the April 15th deadline fast approaching, it’s important to make sure everything is in order. The IRS has shared a series of tips to help speed up your refund and avoid errors on your tax return. Here’s a simple guide to ensure you’re ready to file with minimal stress.
1. Gather All Your Tax Paperwork
Before you start filing, collect all the necessary documents. This includes W-2s (your wage statements), 1099s, and any other forms related to income. If you’re claiming deductions or credits, make sure you have the paperwork to back it up—this could include receipts for mortgage interest, educational credits, or medical expenses. You should also have your previous year’s tax return handy. Sometimes, you may need it for reference.
Additionally, you can check your IRS Individual Online Account to access your W-2 and Form 1095-A (Health Insurance Marketplace Statement). This can save you time if you’re missing any documents.
2. Check Your Personal Details
Accuracy is key when filling out your tax return. Double-check that all names, dates of birth, and Social Security numbers (SSNs) are correct. This includes your dependents’ information. Make sure their names and SSNs match exactly with what’s on their Social Security card. If your dependent or spouse doesn’t have an SSN, you’ll need to enter an Individual Taxpayer Identification Number (ITIN) instead.
3. File Electronically
The IRS strongly recommends filing your taxes electronically. There are a variety of options, including IRS Free File, Free File Fillable Forms, and Direct File. Filing electronically reduces the chance of making math errors, helps you find tax credits or deductions you may qualify for, and even alerts you if any information is missing.
If you choose electronic filing, remember to also select direct deposit. This is the quickest and safest way to receive your refund. On the other hand, if you have to file a paper return, make sure you’ve got the correct mailing address. You can find this on IRS.gov or the instructions for Form 1040.
4. Report All Income
It’s important to report all taxable income to avoid penalties. This includes income from jobs, unemployment benefits, freelance work, gig economy jobs, and even earnings from digital assets like cryptocurrency. If you’re unsure about what counts as taxable income, check out IRS Publication 525 for guidance.
5. Answer the Digital Assets Question
Starting in 2024, the IRS asks a question about digital assets on several tax forms (Form 1040, 1040-SR, 1040-NR, and others). Even if you didn’t have any digital asset transactions, you still need to answer the question. If you did engage in any cryptocurrency transactions, make sure you report them accurately. For more details, visit the Digital Assets page on IRS.gov.
6. Check Your Bank Account Information
When expecting a refund, you can choose to have it directly deposited into your bank account. You can even split it between multiple accounts. If you don’t have a traditional bank account, some mobile apps or prepaid debit cards allow for direct deposit. Just make sure the routing and account numbers you provide are correct. Any mistake here can delay or misdirect your refund.
7. Remember to Sign and Date Your Return
It’s easy to forget, but don’t forget to sign and date your return. If you’re filing a joint return, both spouses need to sign it. For electronic filings, you’ll authenticate your return by entering your adjusted gross income (AGI) from last year. This helps verify your identity and complete the process. If you’re unsure how to validate an electronic return, check out the IRS guidance on the topic.
8. Need to Make a Payment?
Even if you’re not ready to file, your tax payment is still due by April 15th. You can make your payment online through the IRS Individual Online Account, Direct Pay, or the Electronic Federal Tax Payment System (EFTPS). You can also pay using a debit or credit card. Paying electronically makes things smoother and faster. Plus, it’s the easiest way to avoid the need for filing an extension.
9. Request an Extension if You Need More Time
If you need extra time to file your return, you can request an extension. This gives you an additional six months (until October 15th) to file your taxes. To do this, you can pay what you owe and check the box saying it’s for an extension. Alternatively, you can file for an extension at no cost through IRS Free File or by submitting Form 4868 by April 15th.
Just keep in mind, an extension only gives you more time to file, not more time to pay. If you owe taxes, you should still make a payment by April 15th to avoid interest and penalties.
10. Tax Relief in Disaster Situations
If you’ve been affected by a disaster, you may qualify for more time to file. The IRS provides relief for taxpayers in areas impacted by disasters. Check out the IRS website or FEMA’s declarations for the most recent tax relief provisions.
11. Keep a Copy of Your Tax Return
Once you’ve filed, make sure to keep a copy of your signed return and any supporting documents. You may need them later, either to amend your return or to help prepare next year’s taxes. It’s also a good idea to keep records that support your income, deductions, or credits for a few years, just in case the IRS needs to review them.
Final Thoughts
Tax filing doesn’t have to be stressful if you stay organized and follow these IRS tips. The sooner you start gathering your documents and checking your details, the smoother the process will go. Whether you’re filing on your own or with the help of a professional, taking the time to avoid common mistakes can help you get your refund faster and avoid any headaches down the road.
If you need help or have any questions, don’t hesitate to visit the IRS website or reach out to 4SYTE Tax & Biz Consultants.