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7 tax return pitfalls to avoid … and 5 tax breaks not to miss

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in Small Business Tax,Small Business Tax Deduction Strategies

Besides the usual problems bedeviling late filers, several recent tax law changes may cause complications on your 2012 return. Follow these seven steps to avoid problems.  

1.  Enter at your own risk. Many of the usual math errors are eliminated if you use tax preparation software that does the grunt work for you. But that doesn’t mean you’re home-free. You still have to enter the information accurately, either on paper or electronically, on Form 1040. For instance, if your W-2 reflects a salary of $175,000 and you mistakenly enter $157,000 on your tax return, you will substantially underpay your 2012 tax liability.

Double-check your entries and any math you’re doing on your own. Year in and year out, these errors remain the biggest bugaboo for tax filers.

Tip: IRS computers match up income reported on W-2s and 1099s to returns. If the agency finds discrepancies, you could be assessed extra tax plus interest and penalties.  ...(register to read more)

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