3 Tax Mistakes Florida Residents Make Every Day
Most people don't mean to cheat on their taxes, but sometimes vague rules and changing regulations can mean you are cheating on your taxes without even realizing it. The following are the three most common tax mistakes most people make, and how to avoid them.
Mistake #1: Not keeping business and personal affairs separate
This can be harder to do than it sounds. You may be friends with a customer, go on vacation with a client, or buy a vacation home that you rent out in the off season. But you will be better off if you can keep business and personal affairs as separate as possible. Some common mistakes in this area include claiming that a hobby is a business or trying to deduct the fees for your divorce because it put your business at risk.
Mistake #2: Not keeping good records
This isn't just for business owners. Gamblers should keep records of their losses; they can use them to offset a big win they get later in the year. Charitable donation should be made by check, not cash so that you have a record of how much you gave and to whom.
Mistake #3: Not keeping 1099 and other informational forms
1099s and 1098s are considered "information returns," meaning that you are not required to send them in with your return. But you need a system to track and account for 1099s whether you are the payer or the payee. Also be sure to check the information carefully and request a correction if required.
Read more details of each of these common tax mistakes at 3 tax mistakes made every day.
If you live in the Jacksonville, Florida or Orlando, Florida area and require assistance with tax planning, please contact a tax attorney for tax planning legal counsel.
