Lady Liberty Returns

The W-2s are in the mail, if they haven’t already found your mailbox. Guys dressed like the Statue of Liberty are dancing around intersections near you. It can only mean one thing—tax season!

While some of us kind of like the tax season because it means refunds (and that’s whole other story if you’re giving Uncle Sam an interest-free loan every year), most people will admit they hate the actual job of preparing their tax returns. It never seems to get any easier. As a mater of fact, the government seems to delight in confusing us. But there are a few things you can do to make tax season less, well, taxing. The following mistakes have been charted by the good ol’ IRS and reviewed by MSN Money. They show up on returns year after year, so make note and take care to not make the same mistakes and create a headache for yourself.

• Wrong marital status. You know …. single, married. For this tax year (2010), your status is how you were considered as of December 31, 2010. Even if you’re married, you can file jointly or separately. But claim the wrong status, and you can jeopardize your chances of using the child tax credit, earned-income credit or dependent exemptions. You can find directions for selecting your correct filing status here.
   
• Social Security Number(s). If you’re preparing your return the old-fashioned way, filling in the boxes with a pen, be sure your handwriting can be read by those checking your return. Also, be sure to not only input your SSN correctly, but those of any dependents as well.
   
• Correct forms/schedules. Thou Shalt File the Correct Schedules and/or Forms, lest the IRS get miffed and audit you. Audit. Doesn’t the word just make you shudder? You can find IRS forms and schedule here.
   
• Autographed. Remember when you were a kid and you practiced signing your name for the day you would be famous and sign thousands of autographs for adoring fans? Well, the fans may never have showed up, but the IRS loves seeing your John Hancock. Don’t forget to sign your return. If it isn’t signed, it isn’t filed. And don’t forget, jointly filed returns need two signatures.
   
• It depends. All claimed dependents must have their own Social Security Number. No matter how much you consider Lucy the wonder dog family with an open invitation to the dinner table, if she doesn’t have a SSN, she isn’t a dependent. Don’t claim dependents who don’t meet dependent eligibility.
   
• Lost receipts. Receipts can mean money in your pocket with deductions and tax savings. If you donate to a charitable cause, be sure to get a receipt that includes the date, amount and charity name. If you fail to get a receipt, your donation becomes a contribution rather than a donation. Bottom line: no deduction.
   
• Income lax. Unreported income is a major IRS audit target. Be sure to report ALL income. Just because it doesn’t come with its own W-2 Form or a 1099, it doesn’t mean it’s not income. Did you receive cash compensation for a little side job? Income! Fail to declare it and the IRS just may check your bank account for deposits. Think we’re kidding?

These are a few of the more common mistakes made by taxpayers when preparing their taxes. The good news, they’re not too difficult to avoid. Just pay attention to the details when completing your return.

Also, be aware that Vantage members can file simple federal returns online free with TurboTax Federal Free Edition. Or receive a 10% discount with TurboTax Online Deluxe. Click here for more information.