NY CPA Tips: Common Tax Preparation Mistakes to Avoid

Manhattan Tax preparation can be a good time but it can also be a very stressful time and during that stressful time you may forget a lot of things that you needed to keep up with and you may make a few mistakes that can cost you money. Here are some of those mistakes that you need to avoid.

If you do your own taxes NYC then it's important to remember that even the smallest math mistake can cost you a lot of money. If you do the math yourself have someone else check your work if possible or submit it to an online company that will check it for you before submitting your forms.

Don't' pay anyone under the table that works for you. If you have staff working for you then you need to turn them all in on your NYC taxes other wise it will eventually catch up with you and you may need to go back and pay workers compensation as well as taxes.

Childcare expense is one expense that can cause a lot of mistakes. Be clear on the rules, for example, you can only claim the children who are living in your home during the year. They must be under the age of 18 or enrolled in college and still living at home. You can claim expenses incurred for child care while you are working. This includes the cost of care, food, and supplies needed so a caregiver can take care of your child or children while you work. If you are expecting another child you will need to wait until the child is born to claim them. They will need a social security number when you file their name.

Charities are also a deductible but you must list the charities that you are giving to. When giving it is always good to write a check or send a money order so you can keep a receipt of your giving for tax records. Be sure to also keep track of your donation amount. If you have a rounded figure that is fine too but you may underestimate your expense and not count the total amount toward your deduction.

You will need a certain amount of deductions in order to itemize on your NYC taxes. Your New York CPA will be able to let you know if it is feasible for you to itemize. When you itemize you will be able to count any medical expenses, mortgage tax, property tax, real estate tax, and more. If you are able to itemize you may actually get back more money but if you are filing an itemized form you will need to pay for that form before you can use it. You can also use last years' Manhattan tax preparation fees as part of your expenses as well. So if you have a company that prepares your taxes for you then keep track of your Manhattan tax preparation receipts. They may charge a little more but at least you will be protected.

Jonathan Medows, CPA, MBA is the Managing Member of MEDOWS CPA, PLLC, a boutique New York CPA firm serving the needs of individuals, freelancers, self employed individuals & small businesses. To see how he can help you reduce your tax liability and keep you in tax compliance please visit his website:
Medowscpa.com