Avoid Tax Errors

Thinking about filing early? Stop. Avoid tax errors by waiting to file until you receive all year-end documents. Filing early, before you have all your final income statements (from your employer, from self-employment income, from investments, and from other sources of income), will cause issues and delays in the long run.

Why is that? Because the IRS cross-checks to verify income and to prevent fraud. So, if you file without having all your year-end documentation, and the IRS identifies discrepancies between what is reported to them by payers and what you report on your return, your return will be pulled from the regular processing stream and put aside for further investigation; requiring the IRS to send out notices and letters to resolve the discrepancies, which inevitably delays your return processing along with any refund you may be due.

Be aware, the deadline for employers and other businesses to mail out and file wage statements or independent contractor forms with the IRS is generally the last day of January or beginning of February. Some other types of income statements are not sent out or filed until March.

Don’t try to substitute income amounts by using your last payroll statement, as your employer may include year-end bonuses or other types of needed corrections in the total amount shown on your W-2. Also, review all your year-end income forms before you file as they could include a simple typo error, which should be corrected before you file.

Join us in January

Taxpayer Advocate offices around the country are conducting Pre-Filing Season events throughout January 2022. Here we will share even more tips to help you avoid common filling errors this tax season, so you are ready to file an accurate tax return. Check our calendar to find event dates and times.

Can’t make an event? You can view similar tax tips on our website. You can also watch for more tax tip topics and other tax news all year long.