As the end of the financial year closes in, many people find themselves scrambling to file income tax returns in time this year. The Internal Revenue Service (IRS) issues strict guidelines for ensuring a smooth and quick tax filing process. The last thing you want is a notification from the IRS citing an issue with the income tax return submission. So, here are six mistakes to avoid when filing your income tax return: Filing returns prematurely You might receive documentation regarding your current financial status, and this information has to be updated with the IRS. Filing prematurely can result in mistakes like omissions that only delay the processing of returns. Choosing the wrong form or filing status The IRS issues several forms for individuals, businesses, commercial establishments, and government entities to file returns. Ensure you choose the correct form and update the filing status on the official website. If there are dependents in the house or you are filing for a joint return, your filing status can vary accordingly. Making calculation errors Adding the wrong amount, excluding critical tax breaks, or even making mathematical errors while computing your income tax return are issues that IRS software can detect. However, miscalculating the return can delay the process.

The Internal Revenue Service, or IRS, is the governing authority that processes tax returns filed by individuals and businesses and issues refunds. The IRS has issued sizeable refunds worth thousands of dollars in recent years. Individuals can use the money to meet daily expenses and pay pending bills. But to be eligible for prompt refunds, here are some common mistakes you should avoid while filing your tax returns this year. Updating the wrong filing status The IRS lets you file as a single taxpayer, a married taxpayer filing jointly/separately, a qualifying widow/widower, or a sole head of the household. Entering this information correctly is critical while updating the return. Filing under the wrong section can delay processing and refunds. You might even be subject to penalties if there are errors in the calculation. Not reporting all taxable income Salaried employees working for an organization should properly mention any income subject to taxes on Form W-2. Freelancers can report their income using Form 1099. Different kinds of employment and earnings are subject to different tax slabs. The bottom line is that you should never underreport your earned income in the said financial year. If the IRS notes discrepancies, it can order an audit that will lead to subsequent penalties and interest.

Buying a house is a big step, no doubt. Since it is a long-term and expensive investment, it requires proper planning and analysis. One should only take out loans after careful research to ensure financial stability. As applying for loans is time-consuming, rushing through paperwork can lead to negative results. One can avoid most such mistakes with better planning and execution. Here are a few common mistakes to avoid when seeking a home loan. Not monitoring credit score Maintaining a healthy credit score before applying for any loan is important. Poor credit or a bad repayment history will lower the score, disqualifying the borrower from beneficial home loan schemes. A credit score of 700 or more can qualify for preferred loan terms and options from the best banks. If the score falls behind 700, take care of any prior settlements or written-offs by paying them back to establish a good record. Making these changes may take time, so always plan before applying for the loan. Overestimating the repayment capacity When estimating their repayment capacity, people frequently ignore their monthly expenses. Financial difficulties may arise from high monthly expenses and a loan with a high EMI. It is advised that EMI payments should not exceed 30-40% of one’s salary.

Travel insurance is an essential financial cover that protects one from unforeseen circumstances while traveling. From losing luggage to hotel cancellations, there are a few incidents against which insurance can be claimed. But before opting for one, it is important to thoroughly understand the policy document, including what is covered in the insurance and what is not. Here are a few common travel insurance mistakes that travelers can easily avoid. Ignoring credit card perks Several credit card companies offer travel insurance benefits to card holders. If you purchase a ticket using the card, you may be eligible for insurance. Credit card-based travel coverage may include claims against delayed, lost, or damaged baggage; trip cancellation or interruption; medical emergencies; evacuation; travel mishaps; or rental car insurance. With these advantages, frequent travelers might not need to get additional insurance. Not reading the details of the insurance Most travel insurance policies have a “cancel for any reason” provision. However, the requirement for this is often overlooked. The “cancel for any reason” coverage often has to be bought 7 to 21 days after paying the original trip deposit. Additionally, one can only receive compensation if they cancel their trip 48 hours in advance. Depending on one’s level of insurance, the reimbursement amount may vary.

In the rush of filing taxes, it can be easy to overlook deductions that could help you save money. Tax deductions are expenses you can subtract from your taxable income. Knowing which expenses can be claimed as deductions is the key to limiting the hard-earned money you owe the government. From student loan interest payments to health expenses, here are some of the most overlooked tax deductions you should know: How do deductions work? Tax deductions lower the amount of tax you owe. A standard tax deduction—a single deduction of a fixed amount—is determined by your filing status: single, married, head of household, or filing jointly. You can claim the standard deduction without providing additional documentation or expense receipts. In contrast, itemized deductions are specific expenses you can deduct from your taxable income, such as clinical expenses, charitable contributions, and mortgage interest. Most overlooked tax deductions Job hunting expenses If you are looking for a new job in your existing field, you may be able to deduct expenses such as those incurred in resume preparation, traveling for interviews, and career counseling services. Charitable contributions Many know that cash donations to charity can be claimed as deductions but often overlook non-cash contributions like clothing or household items.

The goal of a side hustle is to earn extra money to support one’s lifestyle. With the current economic scenario, people are constantly looking for sources of income besides salaries. It provides greater financial security and the freedom to pursue one’s interests while maintaining job security. The most important aspect of a side hustle is that it is exciting enough to keep one interested. Here are some of the most creative side-hustle ideas for 2023. Best side hustle ideas for 2023 Online surveys Filling online surveys is one of the simplest and most popular side hustles to get started with. Although it might not be the highest-paying job available online, it can be a great place to start learning about time management and balancing two careers, which may eventually lead to finding something more significant. For each survey, people can earn between $1 and $20. Writing blogs Starting a blog can be a fantastic option for people with a creative side who want a voice and a creative outlet. Most blogs generate a little money at first, but as their readership and reach grow, they generate more and more money. Bloggers can earn roughly tens of thousands of dollars per month.

Financial planning is a complicated endeavor that does not stop with simply opening savings and certificate of deposit accounts. You need an expert who can advise you on the best investment and diversification strategies for building a solid portfolio to secure your financial needs. But before hiring a good advisor, it is essential to understand how the process works and how to proceed from here. These questions can be a starting point. Here are the five questions you must ask a financial advisor: What are your qualifications? Financial planning is a vast topic with several areas of specialization in practice. So, you need to understand whether the advisor provides assistance for financial planning in general or focuses on a specific aspect of portfolio building. Primarily, they practice with a Certified Financial Planner (CFP) qualification approved by federal regulatory authorities and guidelines for safe practices. What is the range of services you offer? Their experience will vary depending on the type of services provided, ranging from planning for retirement to tax mitigation strategies and real estate trust services. Some CFPs work as fiduciaries, ensuring they keep your best interests at heart when planning and strategizing your finances. You must also check to confirm any disclosures on the record of previous misconduct or legal sanctions imposed on their range of services.

Financial scams are a common phenomenon in the country; according to data released by the Federal Trade Commission, consumers reported losing more than $3.8 billion due to investment scams in 2022. So, it is important to remain vigilant and practice caution before initiating any online interaction or transaction with a business or a stranger. Here is a look at some common mistakes you should avoid to protect yourself from financial fraud: Using one password for multiple accounts You should frequently change passwords for your sensitive accounts, like those on banking apps and other platforms that have access to your confidential information. So, your accounts investment portals and digital wallets should have unique and strong passwords that are not easy to crack. It is also important to note that using one password for all your accounts increases the risk of fraud. When one account is hacked, others with the same password can also be hacked. Falling for shopping scams Online shopping has made it extremely convenient for customers to order anything from anywhere. While this has helped businesses grow, it has made room for all kinds of scams. You should ensure that the business you are buying from is legitimate. Not only that, you should use a secure Wi-Fi network to carry out all kinds of transactions.

When considering low-risk investment options, a certificate of deposit (CD) is one of the most common options. CDs offer a safe way to grow savings while earning a fixed interest rate over a set period. However, like any financial endeavor, opening a CD requires careful consideration and knowledge to avoid common pitfalls and get the most out of the investment. So, here are five common mistakes to avoid when opening a CD: Not exploring all options One of the most common mistakes while opening a CD is not shopping around for the best rates. Banks and credit unions offer varying interest rates on CDs. Failing to compare rates could make one miss out on higher returns. So, one must explore various financial institutions and choose one offering the most competitive interest rates. Ignoring the fine print All financial products come with terms and conditions, and CDs are no exception. Ignoring the fine print could lead to unexpected surprises and financial losses. Some CDs have penalties for early withdrawal, while others may automatically renew at less favorable rates. So, it is crucial to read and understand the terms of the CD agreement beforehand to ensure it aligns with individual financial goals.

Investing in precious metals is a smart addition to diversifying an investment portfolio. Precious metals are a popular commodity and a less volatile market when compared to stocks. With multiple regulatory authorities and trading platforms, investing in precious metals hassle-free has also become easy today. But there are many points one must consider and be well-informed before investing. Here are some key things to know before investing in precious metals. Understand the types of precious metals Gold, silver, platinum, and palladium are popular precious metals with unique characteristics, market demand, and investing dynamics. Invest only after a thorough comparison. Diversification Precious metals can be an effective way to diversify any investment portfolio. They often have a low association with other assets like bonds and stocks, which can help reduce overall portfolio risk. Storage and security Physical ownership of precious metals necessitates the need to invest in home security. Options include home safes, bank safety deposit boxes, or third-party storage facilities. Be sure to consider the associated costs and security measures before buying assets. Physical vs. paper investments There are two ways to invest in precious metals: purchase physical bullion (coins or bars) or invest through paper investments like exchange-traded funds (ETFs), online futures contracts, or online mining stocks.