Filing your taxes is a meticulous process. The Individual Income Tax Return form alone requires you to complete a total of 13 steps before you can even begin to file your return.
It’s easy to make mistakes, given the process. Know what to avoid to save time and money. Here are tax mistakes homeowners should steer clear of:
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Tax miscalculations
Even the smallest miscalculation could affect your taxes, leading to trouble with the International Revenue Service (IRS). Make sure that you double or even triple check your tax statements and documents before submitting it. You can also use online software or programs for calculating your tax or have a tax professional take a look at your tax forms.
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Last-minute filing
One of the most common mistakes that homeowners make is leaving the filing of their taxes to the last minute. You are more likely to miss the deadline, however, when you realize that you’re short on documents you’ll need to submit with your return. You’ll also be charged interest when you fail to pay your taxes on time. File your returns as early as you can to make sure you don’t overlook anything that’s required.
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Not paying attention to the other details
When we’re focused on getting the numbers right on the tax forms, we may misspell names or forget certain dates and years. If the details on your tax forms don’t match the information on the IRS database, it could lead to delays or problems in your taxes.
Mixing up the years when filing taxes is a common mistake made by homeowners. When filing, make sure that you are aware of the current year and the year that you are filing for. You should also ensure that the name and address you use on your tax forms are the same names and address as your Social Security number.
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Not keeping track of expenses on home improvements
If you add more features or amenities to your homes such as a swimming pool, a sunroom, or central air conditioning, it could entitle you to a tax break when you sell your home. Just make sure that you keep the receipts and records for proof of your home improvement expenses.
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Not including other income
Aside from listing down what you earn during your day job, you also need to disclose your earnings from other sources of income such as freelance work, bonuses, and other side jobs. Failure to include these other sources of income could lead to trouble with the IRS.
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Incorrect use of the home office deduction
Having a home office entitles you to tax deductions. The amount will depend on the space you’re using, how often you’re using it, and the size of your home office. Keep records of related expenses like electric and utility bills, and office equipment purchases. To avoid calculating your home office deductions incorrectly, hire a qualified tax professional.
Having the right professionals by your side to help you with the trickier aspects of filing your tax returns, or purchasing a home saves you time and money. Learn more about the real estate properties in Greater Cleveland by browsing the website. You can also call one of the best realtors in Cleveland, Cici Riley at 216-831-9310 or send an email to CiciRiley(at)HowardHanna(dotted)com.