By Linda Stern
April 7, 2008 issue
Every tax season has its own set of blunders—mistakes that can cost you real money. Here’s what to avoid this year.
Not filing. If you made $3,000 last year but didn’t earn so much that you’re required to file a return, file one anyway. It’s the only way you’ll get your stimulus check.
Spending too much to get an extra-fast refund. Many preparers offer instant or one-day refunds. But the refunds are really expensive loans guaranteed by your refund. They can carry fees that can add up to a hefty sum. Just authorize the IRS to deposit your refund directly into your bank account.
Not checking for extra write-offs. Tax year 2007 carries some special credits and deductions that are easy to miss. Teachers who buy supplies, homeowners who save energy, folks who lost property in hurricanes and tornadoes, those who have kids in college or anyone who’s gotten relief from their mortgage banker should all make sure they are getting what they are due.
Failure to sign. Every year many taxpayers forget to sign their forms. Send it April 15 without a signature and you can end up owing late-filing penalties and being last in line for that stimulus check. Big mistake.