Tips for last minute tax filers to avoid common pitfalls

April 8, 2013 4:27:03 PM PDT
Tax time is here and if you haven't filed your return yet, time is running out. You only have a week left to get it in. And, if you are rushing you could make some mistakes that will cost you.

Tax experts shared with us the most common mistakes people make when they prepare their returns. Some of these mistakes could cost you more than you actually have to pay.

Tax preparers are seeing a steady stream of clients and accountants hardly have a break with so many tax payers waiting to file their return.

"Taxes are so intimidating to the vast majority of the public," said Elizabeth Ferrer with Neighborhood Tax Centers. "They are always looking for someone else to do their taxes."

But before you pay for someone to help with your taxes, first, Ferrer says look for free tax programs like theirs in southwest Houston. You will have to qualify for the free service.

"We serve families who earn up to $70,000 and individuals who earn up to $30,000," Ferrer explained.

The IRS is also offering providing Free File. It's a no-cost, federal income tax preparation and electronic filing software. It's available for families who earned $57,000 or less last year.

Next, get organized and get all your paperwork together. Accountant Terri Siegel with Margolis, Phipps and Wright says it could save you big.

"The more organized you are the lower the fee is," Siegel explained.

Another huge tax money saver -- don't forget about your dependent care credit.

Siegel said, "What is even better is that many employers have a flexible spending account plan which would let you put money in that account for your daycare or medical expenses."

Then those amounts are subtracted from your income on your W-2, which can be a huge money savings.

Next, be sure your preparer doesn't charge you to e-file or direct deposit, because those programs are already built into the software.

"The common credits that people get such as earned income credit and child tax credit automatically populate on any software, so you should not pay extra for that either," Ferrer said.

Finally, whatever you do, take action! File an extension if you have to, because doing nothing will cost you significantly more.

"If you don't take any action on April 15th and you owe, you are going to get hit with several fees, including interest that you owe," Siegel said.

The biggest mistake filers make is misspelling their name or using a nickname on their return. The IRS will not file it without the exact name that's on your Social Security card.

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