How to file your taxes like a finance expert
Tax time doesn’t need to be particularly burdensome if you’re prepared. For this reason, it’s always best to file your taxes early, so you can rest easy knowing your taxes have been paid and your returns are coming. Think of filing early as a way to avoid fraud while seeing to it that you get your money back sooner rather than later. However, in the rush to file early, some people make mistakes that can be costly in terms of time and money. Try to avoid repeating these mistakes that others have made so you don’t have to.
The first mistake people often make is not filing for all of their income sources. You need a W2 or 1099 for every income source netting you over $600 during the financial year. Your day job and your side hustle all need to be accounted for, or you can get into some trouble down the line.
Next, if you’re filing your taxes early anyway, take the extra time to double-check. The software can be used to assist you in filing your tax forms, but they can’t catch all potential typos. Don’t be one of the people who file their taxes early just to end up accidentally reporting false information. If you do, the IRS will catch your errors and you could face interest and/or a penalty for underpaying your taxes.
Lastly, if you messed up your first tax forms, don’t mess up the second set. If you filed your 1040, but later realize you made a mistake, don’t immediately fill out another form. If your first set of forms contained errors, you will need to fill out a 1040X and correct your mistakes there. You’ll also need to send paper copies of your 1040X.