Is there anything more stressful than having to deal with taxes? Some people are able to file their taxes without a problem, while others can run into difficulties. Maybe you had to file late because of an issue with your employer or some personal problems. Or perhaps you’re being audited, and are trying to figure out how to avoid going through the process in the future. Either way, if you want filing your taxes to be relatively pleasant or pain-free the next time around, make sure that you don’t make these common mistakes in 2016.
Forgetting to update your household status
Many people wrongfully assume that if they didn’t get married in the past year, they don’t need to change their household status. Marriage is only one of the many things that might require an update in status. For instance, did you have a child in the last tax year, or maybe even combine two families after a remarriage. Have your adult-aged children finally gotten a job, and begun filing as individuals? All of these things can affect your taxes, and you should take them into account when you file.
Going off of old numbers/forms
Taxes aren’t a static institution, and codes and laws are in a constant state of change. Tax rates, deductions, exemptions, and income cutoffs for benefits can change from year to year. Always be sure that you’re aware of the latest tax changes on both the federal and state levels. Also, be sure that you’re working with the most up-to-date tax forms.
Deducting too many business expenses
Deducting business expenses can be tricky – especially if you’re the owner of the business. Big businessmen like David Stewart need to be careful when they claim or they could be accused of tax evasion. Let’s say you run a business out of your home, and you’re trying to figure out what to claim as business expense. Your car and your computer can almost always be written off, but when it comes to other personal possessions, the lines can get a little blurred. Feel free to claim things that you mainly use for business, like office supplies and electronics. Don’t claim meals, certain travel expenses (your hotel room is fine, the live show you saw on your business trip isn’t), and other things that you aren’t 100% sure qualify.