*Yikes! Is it April again…already? Well not quite, but almost. And we all know what time it is when the 15th rolls around. Yeah, I hated that date before it turned out to be a loved ones birth date. Now I LOVE that date because, well, I love everything about her.
Back to you. There is so much to know when it comes to filing taxes, and if you do your own (I don’t. I’m not that good; but YOU may be), you’ll want to make sure you’re getting all that you can out of the experience. And even if you don’t do your own, you should just want to be aware of certain things.
Experts say filers seem to always make costly mistakes, and they point out these 4 mistakes in particular.
Trust me, you’ll want to read this.
Your W-2 or 1099-miscellaneous forms should to be in your hot little hands by January 31.
TaxAct product manager, Jenna Ivanoski warns us not leave out any income information (even if that income is under the minimum required to send a 1099). Let me break it down for you. Your employer, client or whoever paid you money for a service is required to file and you don’t want to raise any “red flags” if your numbers don’t match theirs.
Back to Ivanoski, who shares that, the minimum amount you have to have earned for a company to send you a 1099-Misc is $600, but you’re required to file anything more than $400. So there’s a bit of a gap that can trip people up. Make sure you’re not one of them.
I’m a receipt junkie! My receipts are so old the ink has faded, but I keep those bad-boys because those of us who have businesses, especially, have to let Uncle Sam know that what we spent money on was truly for business.
Ivanoski says Bank Statements alone won’t be a reliable substitute.
Quarterly Tax Payments…Don’t Miss ‘Em
I can feel your pain my sisters and brothers who utter, Uh, what’s that?” WE should be giving our “Uncle” money on a quarterly basis, if we expect to make more than $1,000.00.
But wait! This may not have to be the case for you. Ivanoski says…
You might not have to pay quarterly taxes, though, if your untaxed income comes from a side hustle. You can update your W-4 at your main job to have fewer allowances and more tax withheld from each paycheck. You should still do the math to determine how much you expect to earn in untaxed pay so that you know how much extra you’ll need to have withheld from your W-2 job. She suggests to visit the IRS website for more info on this.
Hmm…I just felt someone cringe. Is it because your salary at your W-2 job is actually quite pitiful already…and you can’t afford to have more taken from it?
Too bad! I’m sure I must be quoting Uncle, somewhere.
Let’s move on.
…to the final mistake we should NOT make.
Don’t expect a deadline extension
This may be news to procrastinators but…only those who expect to get refunds can expect a successful filing for extensions. If you know you’re going to owe Uncle, your money is still due in April.
I’ll shut up now.