7 On Your Side:Tax Filing Mistakes - KTRE.com | Lufkin and Nacogdoches, Texas

4/3/06-Tyler

7 On Your Side:Tax Filing Mistakes

  The first mistake: Failing to document charitable donations. It's not good enough to just input the dollars amounts, says Tyler CPA Barbara Bass, but you must have back-up to prove your generosity in 2005. "That organization must give you documentation and that documentation is to validate that as a charitable contribution subject to deduction with the internal revenue service," says Bass.
  Next, unnecessarily declaring your state tax refund as income. Obviously, this doesn't apply to Texas residents, but if you lived in another state last year, you need to determine if you fall in a certain category to know if you declare your 2004 refund or not. "That refund is not taxable to them unless they itemized the deductions the prior years and got the benefit of the state income tax as an expense of their itemized deductions," says Bass.
  Leaving off attachments: you must attach all schedules and forms to your 1040 using the sequence number in the upper right corner of each schedule or form.
  Overpaying your social security taxes: If you worked two or more jobs last year with earnings of $90,000, you may have overpaid social security taxes.
  Also, reporting investment income in the wrong place.
  Believe it or not this next mistake is pretty simple: omitting social security numbers of dependents. "What I see a lot of times is if they have a new addition a new baby, and they will get me the name but not the social security number," says Bass.
  Another mistake, forgetting about carry-forwards from prior years. Capital losses or charitable deductions may be eligible to write off from years past.
  The next one's not a surprise: making math miscalculations. "Add, add, add, double check numbers and try to get it right the first time so you don't get your refund delayed," suggests Bass.
  Plus, failing to calculate the alternative minimum tax. It's form 6251 and is the government's way to make sure you paid enough taxes. "There's a cut off amount of $58,000. Depending on your tax situation if you make more than that then you need to do that calculation."
  And last on our top 10 list: assuming itemizing deductions will reduce the tax bite. It may be a bigger benefit to take the standard deduction instead of itemizing. Another tidbit: your taxes are due Monday, April 17th, since the 15th falls on a Saturday. And failure to file them is a big mistake you don't want to make.

Christine Nelson reporting. cnelson@kltv.com

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