Most Common Costly Tax Mistakes
With about two weeks to go before the filing deadline it's crunch time for some taxpayers.
That last minute sprint to the finish can sometimes lead to costly mistakes.
The IRS sees some of the same mistakes year after year and they are costing people money.
Local CPA Chris Porter said one costly mistake Washington residents make is missing their sales tax deduction.
Since there is no income tax in the state of Washington taxpayers should take a sales tax deduction.
Porter said people often forget to include the local sales tax when calculating their sales tax deductions.
"The mistake people make is that in Washington we pay 6.5% sales tax but we also pay a local sales tax. For example in Richland, Kennewick and West Richland it's 8.3%, which is 6.5% state and 1.8% local, so you put those together and you get 8.3%. When people calculate the sales tax deduction on their own often they just use 6.5% and forget about the 1.8%," said Porter.
He said taxpayers should choose wisely among the options for filing status.
"If someone was divorced they might check the box that they are single. They might forget about the fact that since they are keeping up a home for dependent children that live with them for more than half the year they can more than likely qualify for a filing status head of household, which is going to save you on taxes over checking the box for single," said Porter.
He said another filing status to look out for is the year a spouse passes away you can file married filing joint as long as you haven't re-married by the end of the year.
One costly error that effects everyone regardless of where you live or your filing status, is interest on any money you might owe starts adding up after April 15th regardless of an extension.
"You can file an automatic six month extension and some people think that gives them six more months to pay a tax liability that is due, and that's not true. The taxes are due April 15th. If you extend it just gives you more time to file the return," said Porter.