Tax season can be overwhelming—and mistakes happen more often than you might think. Even minor oversights can lead to missed deductions, increased taxes, or penalties and fees from the IRS. Here are 10 common yet costly tax mistakes taxpayers unknowingly make:

• Filing Late or Not at All: Penalties can significantly add up.

• Incorrect Filing Status: Choosing the wrong filing status can lead to missed deductions.

• Ignoring Tax Credits: Missing out on valuable credits like Child Tax Credit or Earned Income Credit.

• Not Reporting All Income: Forgetting income from side jobs or freelance work.

• Math Errors: Simple calculation mistakes cause significant delays and recalculations.

• Overlooking Deductions: Failing to itemize correctly or ignoring standard deduction rules.

• Incorrect Bank Account Information: Can delay refunds considerably.

• Improperly Claiming Dependents: Confusion over who qualifies can lead to audits.

• Not Maximizing Retirement Contributions: Missed opportunity for tax deferral.

• Failing to Adjust Withholding: Can result in unexpected tax bills.

To avoid costly mistakes and maximize your return, consult a tax professional. Schedule an introductory call today.

Navigating IRS Audits: What You Need to Know

Receiving an IRS audit notice is intimidating, but understanding the basics helps. Here’s what you should know:

• Triggers for IRS Audits:

  • High income

  • Excessive deductions

  • Reporting discrepancies

• Types of Audits:

  • Correspondence Audit (mail-based, common)

  • Office Audit (local IRS office)

  • Field Audit (IRS visits your home or business)

• Documentation:

  • Keep accurate records of income, expenses, and deductions.

  • Respond promptly with organized documentation.

Navigating an audit alone can be risky. Professional representation significantly improves outcomes. Contact us for audit support.

Understanding the Impact of Remote Work on Your Taxes & Common Tax Mistakes

Remote work has transformed how and where we work, creating unexpected tax complexities:

• Home Office Deductions: Strict rules apply, especially for employees versus self-employed individuals.

• State Tax Complications: Working remotely from a different state than your employer can lead to multiple state filings.

• Expense Reimbursements: Employer reimbursements vs. deductions.

Mistakes in these areas can trigger audits or penalties. To clarify your remote work tax obligations, schedule a personalized consultation.

Life Events and Your Taxes: Marriage, Divorce, and Having a Baby

Major life events significantly influence your taxes. Here's how:

• Marriage:

  • Filing status changes

  • Joint vs. separate returns

• Divorce:

  • Alimony payments and deductions

  • Child custody impacts

• Having a Baby:

  • Child Tax Credit eligibility

  • Dependent care deductions

Each scenario comes with unique tax implications. Ensure you maximize opportunities and avoid pitfalls by consulting with a CPA today.

The Ultimate Checklist for Preparing Your Taxes: Are You Really Ready?

Preparing your taxes efficiently requires gathering important documents. Use this checklist as a starting point:

• Personal Information: SSN, IDs, prior year tax return

• Income Documents: W-2, 1099 forms, interest/dividend statements

• Expense Records: Receipts, mortgage statements, charitable donations

• Health Care Information: Forms 1095-A, B, or C

• Retirement Contributions: IRA, 401(k) contribution confirmations

Missing essential documents can lead to issues. For personalized help organizing your tax documents, schedule a consultation.

Retirement Planning and Tax Efficiency: Are You Leaving Money on the Table?

Effective retirement planning is about more than saving; it's about tax efficiency. Key considerations include:

• Traditional vs. Roth IRA: Immediate deduction versus future tax-free withdrawals.

• 401(k) Contributions: Maximizing contributions to lower taxable income.

• Required Minimum Distributions (RMDs): Understanding mandatory withdrawals and tax implications.

Many taxpayers miss these opportunities, leaving substantial savings behind. Contact us to tailor your retirement planning for maximum tax efficiency.

Capital Gains 101: How Your Investments Affect Your Taxes

Your investment activities significantly impact your taxes through capital gains:

• Short-Term Gains: Investments held under one year taxed at ordinary income rates.

• Long-Term Gains: Investments held longer than one year taxed at lower, preferential rates.

• Capital Losses: Can offset gains and reduce tax liability.

Understanding these rules can save you money and help strategically manage your portfolio. Schedule a personalized consultation to optimize your investment taxes.

Legal Disclaimer

The information provided in this blog post is for general educational and informational purposes only and does not constitute tax, legal, accounting, or financial advice. Laws and regulations change frequently and can vary by jurisdiction. You should consult a qualified tax professional, attorney, or other licensed advisor who is familiar with your specific circumstances before taking any action based on the content herein.

Reading, sharing, or using this material does not create a CPA–client, attorney–client, or any other professional relationship between you and the author or the author’s firm. While we strive to keep the information accurate and up-to-date, we make no warranties or representations regarding its completeness, timeliness, or accuracy and disclaim any liability for errors or omissions. Use of this information is at your own risk.