As we approach a new tax filing season we have compiled a list of things for you to remember before filing your return.
DO NOT file your taxes with your last paycheck stub from the year
DO NOT file your Taxes with your year’s final paycheck stub. The information on the final paycheck can be different than what was on the W-2 and sent to the IRS. Wait for all your forms to arrive before you submit your tax return. Taxpayers filing with their final paystub tend to run into delays and problems with their tax returns. We do not recommend anyone file taxes with their final pay stub. Filing your tax return with your last paycheck stub can and will delay your tax refund. Most paycheck stubs do not have all the information needed to complete the return which could trigger an audit. The Form W-2 Verification Code is a cooperative effort between payroll service providers, employers, tax software providers, tax professionals, the Social Security Administration and the IRS to ensure the accuracy of the information reported on tax returns and to identify fraudulent tax returns. If you file a return and you didn’t include a required w-2 verification code this could be a signal to the system something may not be correct and could cause you further delay.
Wait to file your tax return until you are sure you have received all your W-2’s and income statements
If You Have Worked one single place or a few different places this year. Some employers may take longer than others to get you the forms you need to file your taxes. Stay patient, Some may think about filing their tax return before they receive certain forms, DON’T. One of the biggest causes of errors and delays is impatience. Waiting a few extra days or even a week to make sure you have all the forms and documents needed to file a complete tax return could save you long delays with the IRS.
If you or your dependents had insurance through the Health Insurance Marketplace you must file the 1095-A
Form 1095-A is the main Marketplace tax form you need if you or any member of your household were enrolled in a health insurance plan that was administered through the Health Insurance Marketplace which can be state-run or federally facilitated through healthcare.gov. You must wait until you get an accurate 1095-A form before filing your taxes. This is because your 1095-A has the information you need to calculate your premium tax credit, which is reported on IRS form 8962. However, you’re not obligated to complete form 8962 if you didn’t get any premium tax credit.
If you did not receive a 1095-A form through the mail you can log into your healthcare.gov account to get the necessary information. Failure to file this form could delay your tax refund and also cause you to wait for letters by mail and have to fax more information to the IRS to complete your return. You can save yourself the headache by preparing yourself by knowing if you had marketplace insurance and making sure you have the 1095-A documents needed to complete your tax return.
Should I file before February 15th if claiming EITC or ACTC Credits
It is recommended to file as soon as you have all the documents needed to file your tax return. This helps to prevent identity fraud and duplicate tax returns.
- We don’t recommend anyone to file their taxes right after new years to be first in line. Wait until the end of January once the IRS officially opens to give yourself time to make sure you have all the documents needed to file a complete tax return.
- If you are not claiming the EITC or ACTC credits you can file starting around opening day around the last week of January as long as you have all the documents need to file a complete tax return.
- If you are claiming EITC or ACTC credits and file before February 15th your refund will be delayed with a PATH message to allow the IRS more time to verify income reported on those returns. The PATH Act law mandates that the IRS not issue any refund on tax returns claiming the Earned Income Tax Credit or Additional Child Tax Credit until after February 15. The additional time helps the IRS stop fraudulent refunds from being issued to identity thieves and fraudulent claims with fabricated wages and withholdings
- Taxpayers claiming EITC or ACTC credits that wait to file taxes until after February 15, will not see the PATH Message and refund timing will not be affected by the PATH ACT delays. Those refunds will be issued after your return completes processing, provided you owe no other liability.
Keep all receipts if filing self-employed
Self-employed people should make sure to save the correct information and make it easier to produce accurate books at the end of the year. Keep receipts from every purchase you make and every activity that you pay for while doing business. Keep every meal receipt from business lunches, the dry cleaning receipts for your suits and the hotel receipts from business trips. Purchase an expandable file folder where you can keep your receipts organized. Organize your receipts by function to make them easier to catalog.
Remember To Double Check Even Triple Check Your Tax Return Prior To Submission
Keep in mind that one of the most important things taxpayers can do to limit errors is to double-check the information they input into software or a printed form. It may seem like common sense, but going back over the information you enter may be the most important part of your tax filing duties. It’s easy to put a figure on the wrong line – in fact, one of the most common errors is not putting in the right Social Security numbers for you, your spouse and your dependents. An error like that can cause a significant delay in the processing of your return or, even worse, could trigger an audit.
DO NOT allow “Tax Preparers” without PTIN (Preparer Tax Identification Number) file your taxes
Because if they steal your money you can’t track them down and hold them accountable.
- Check their credentials. Search through the IRS for preparers who currently have professional credentials recognized by the IRS or who have an Annual Filing Season Program Record of Completion.
- Research the tax preparer’s history. Scammers will often open up a business and claim to be a tax preparer just in time for filing season. Make sure the preparer you’re working with has a credible history.
- Avoid tax preparers who are getting paid based on a percentage of your refund, who claim they can get you a larger refund than other tax preparers would be able to, or who want you to pay extra for a guarantee in case of an error on your return.
- Get estimates and compare costs and services from several tax preparers before you hire one.
- Before you submit your return, review it carefully to make sure your preparer hasn’t claimed a credit you’re not actually qualified for.
- Do not let your tax preparer direct your refund into their bank account. Your refund should be mailed or directly deposited to you.
- Never sign a blank tax return. If you’re working with a paid preparer, they need to sign the tax return as well and include their PTIN.
Double Check your Financial Institution or Prepaid Card account and routing number information before you even submit your Tax Return. This will ensure the bank or card is open and active.
Entering the wrong account/routing number information or using closed/inactive account information when filing your tax return is one of the most common mistakes taxpayers make every year. Entering the wrong account information can and will delay your tax refund.
If you enter the wrong account and/or routing number for your direct deposit. In most cases, the bank will catch the error and return your money to the treasury rather than making the deposit in the wrong account. You’ll know something is wrong when you check WMR and it shows you are getting a deposit, then you find out that your direct deposit didn’t get credited to your account as planned. Once you suspect that you provided the wrong account number, call your bank to ask what happens to the deposit in this situation. Usually, the deposit goes back to the treasury department. In that case, you need to contact the IRS and inform someone there of your mistake.
Unfortunately, this means you won’t have access to your money until the issue gets resolved. The treasury will require that the money returns to its account before cutting and mailing you an old-fashioned paper check.