April 15 âtax day â isnât all that far away, and a lot of taxpayers are not sure how the recent action (or inaction) by Congress affects this yearâs tax return. Not to worry, says master tax advisor Mary VanDersarl, who has been doing taxes for H&R Block for 25 years. But there are some changes to the 2017 tax code, so do your homework before filing.
Millions of Americans save money by doing their own taxes, and if the job is simple, thatâs fine, she says. The online tax options are often easy for those with a basic return. But even simple returns can have costly mistakes. âWe see errors to the good and to the bad,â she says. âWe see people taking deductions theyâre not entitled to, and people not taking deductions they should.â
Here are some tips from a tax preparer who has seen it all:
Get your filing status right.
âIâve had people who have made mistakes as simple as misidentifying their filing status,” VanDersarl said. “We had a man who filed as âhead of householdâ and put his wife down as a dependent because she didnât have a job. They did much better when they filed jointly.â
Who gets to claim whom?
Thereâs often confusion in blended families as to who gets the child tax credit, she says. That depends on where the children live, whether or not the adults in the household are legally married, and many other factors. Such situations may require professional help.
Questionable deductions
Sometimes employees spend money out of their own pockets for their jobs and instead of filing for reimbursement from the company, try to write it off on their taxes.
âThatâs the kind of thing that will get you audited,â VanDersarl says.
Record keeping
Everyone should keep good records, but self-employed people must keep meticulous records, including mileage logs and every receipt for every expense thatâs allowed.
Donât file too early
People are so anxious to get their refunds, they file before they get all their W-2 or 1099 forms from employers. Re-filing can be a pain. If you have not received all your forms by the end of February, you may contact the IRS for assistance.
Charitable contributions
Be specific about charitable contributions. If you donate money to a charity, try to get a letter of acknowledgement.. If you donate goods to a charity, like Goodwill Industries, ask for a receipt. And list everything in the donation (five pair of womenâs jeans, one set of window curtains, etc.) and try to get an estimated value on each item (like how much it might bring at the second-hand store). Keep that along with your receipt. You can find a good chart of probable values if you go online to Goodwill.org.
The last detail
And if filing by snail-mail, donât forget to sign the form. âYou wouldnât believe how many people do that,â she says. âThe IRS will send it right back to you.â
Want more information on tax savings?
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8 deductions parents shouldn’t miss
How to make the most of your charity dollars