Most common and costly tax mistakes

Filing your taxes at the last minute can lead to mistakes. Here's a look at some of the most common -- and costly -- errors.
March 31, 2014 12:00:00 AM PDT
In the final days before the federal income tax filing deadline, things can get stressful. The IRS sees some of the same costly mistakes each year, so taxpayers should take a moment to review and avoid them.

According to Kiplinger's Personal Finance, taxpayers should choose wisely among the options for filing status. Filing as single instead of head of household makes a difference. So can choosing between married filing jointly, or married filing separately. Using the wrong status could result in a return being rejected, or a delayed refund.

Math errors should be less common now that so many Americans use tax preparation software. But if a math mistake means you underpay the IRS, you'll owe the additional amount plus any interest since the due date for that return.

Speaking of interest, it starts to pile up after the April 15 deadline, whether an extension is filed or not. If you're not ready to file and think you're going to owe money, at least file the appropriate paperwork and try to estimate what you owe.

And finally, too much withholding is a mistake too. It's great to get a big refund in the spring, but wouldn't it be better to have a little extra money in your paycheck throughout the year? To adjust withholding going forward, revise and submit a new W-4 form to your employer.