No. 3: Forgetting unearned income
Trust us, you don't want to overlook interest income, dividends, capital gains and other unearned income on your return. After all, the bank does tell the IRS about every penny you earn.
Those pesky 1099 forms that go to the tax agency include your social security number, so even if you don't remember that unearned income, the IRS will.
If you owe taxes on that income, the IRS will let you know. If they don't catch it right away, you could end up also owing interest and penalties on the unreported income.
When it comes to actually reporting that income, be sure to figure any taxes you do owe correctly. If you're subject to the alternative minimum tax, keep an eye on box 9 of the 1099-INT form. Another box of interest is 1b (qualified dividends) of the 1099-DIV form, which are eligible for lower capital gains tax rates.
No. 2: Not filing on time
The IRS reports that up to 20 percent of Americans wait until the last week to file. Just something to think about as you rush around on tax day trying to get everything done.
But make sure you do get everything in on time. Because once you are late with your taxes, you've opened a Pandora's box that can get worse with each passing day -- literally.
The IRS will start charging you interest payments, compounded daily, as soon as you are late. Then there are the penalties for filing late, which varies depending on how much you owe and how late you are.
While you can file for a six-month extension using Form 4868, you still need to file that form and pay any tax you owe by the regular filing deadline.
Really, it's much better to get it all over with and not end up paying more to the IRS than you need to.
No. 1: Forgetting to sign your return
Don't make perhaps the most embarrassing tax mistake of all -- sign your return.
According to the IRS, 1 million people each year forget to take that one final, simple step.
If you're filing electronically, you obviously don't have to worry about this step. Besides the fact there are no physical papers to actually sign, tax preparation software and websites won't send your return to the IRS without every step being complete.
But, believe it or not, about half the people filing individual tax returns still do so the old fashioned way. So if you're one of those filers rushing to the post office at the last minute, don't forget to sign your forms before stuffing them into the envelope.
Not signing your forms -- or forgetting to have your spouse sign if filing jointly -- won't kill your return, but it could put your last-minute filing past the deadline and will delay any return you have coming.