Overview
Filing Form 1040 correctly matters. Errors increase the chance of refund delays, IRS notices, penalties, or even an audit. In my 15 years preparing returns and advising clients as a CPA and CFP®, I’ve seen the same mistakes recur each year. This article explains the most common Form 1040 mistakes, why they matter, and concrete steps to prevent or correct them.
Quick checklist before you file
- Verify Social Security numbers (SSNs) and names match SSA records.
- Confirm filing status and dependent eligibility (see IRS Publication 501).
- Reconcile Forms W-2, 1099 (all types), and brokerage statements with what you report.
- Double-check bank routing and account numbers for direct deposit.
- Ensure signatures (or electronic PINs) are provided for e-file or paper returns.
- Keep supporting documents for at least three years.
Common mistakes, why they happen, and how to avoid them
Below are the frequent errors I encounter, how they impact your filing, and practical prevention steps.
1) Incorrect or mismatched Social Security numbers
- Why it matters: The IRS uses SSNs to match wage and withholding information. A wrong SSN for you, your spouse, or a dependent can delay processing and tax credits.
- How it happens: Transposing digits, using an employer’s EIN for a dependent, or entering a child’s name that doesn’t match SSA records.
- How to avoid it: Verify SSNs on Social Security cards. If a dependent’s name changed, confirm with the SSA before filing. If you receive an IRS notice about mismatches, respond promptly.
2) Choosing the wrong filing status
- Why it matters: Filing status affects tax rates, standard deduction amounts, and eligibility for credits.
- How it happens: Misunderstanding marriage, divorce, head of household, or qualifying widow(er) rules.
- How to avoid it: Review IRS Publication 501 for definitions and examples. When in doubt, run both filing-status scenarios in tax software or consult a tax professional.
3) Omitting income (W-2s, 1099s, gig income)
- Why it matters: The IRS receives copies of most information returns. Missing income can trigger a matching notice and interest or penalties for underreported tax.
- How it happens: Forgetting a 1099-NEC, bank interest, or income from side gigs.
- How to avoid it: Reconcile every information return you receive against your records. Keep a separate worksheet for freelance or gig income. Remember that even small amounts must be reported.
4) Math errors and transcription mistakes
- Why it matters: Math mistakes can change your tax due or refund and lead to IRS adjustments.
- How it happens: Manual calculations or transposing numbers when entering amounts into e-file software.
- How to avoid it: Use IRS-authorized e-file software or a professional preparer. If you prepare paper returns, use a calculator and cross-check totals.
5) Wrong bank account or routing number for direct deposit
- Why it matters: Incorrect bank details delay refunds and can require the IRS to issue a paper check.
- How it happens: Typing the wrong digit, confusing checking and savings routing numbers, or using a closed account.
- How to avoid it: Copy numbers directly from a check, not from memory. Test new direct-deposit info with a small non-tax transaction before relying on it for refunds.
6) Missing signature or e-file PIN
- Why it matters: An unsigned return is not valid and will delay processing.
- How it happens: Forgetting to sign a paper return or neglecting to provide an electronic signature for e-file.
- How to avoid it: If filing on paper, sign and date the return. If e-filing, follow software prompts for the PIN or use the IRS Identity Protection PIN if applicable.
7) Incorrect or unclaimed credits and deductions
- Why it matters: Misstated credits like the Earned Income Tax Credit (EITC) or Child Tax Credit can cause eligibility reviews or audits.
- How it happens: Claiming credits without meeting all criteria or failing to substantiate qualifying expenses.
- How to avoid it: Review credit requirements on IRS pages (EITC, child tax provisions). Maintain documentation proving dependents, income, and eligible expenses.
8) Failure to report health coverage information correctly
- Why it matters: While the federal individual mandate penalty is no longer in effect for most taxpayers, reporting requirements and state mandates can still apply.
- How it happens: Overlooking Forms 1095-A, -B, or -C and not reconciling marketplace advance premium tax credits.
- How to avoid it: Keep health coverage notices and review Form 1095-A if you used the Health Insurance Marketplace.
9) Not making or underpaying estimated taxes (self-employed taxpayers)
- Why it matters: Penalties and interest can accrue if sufficient tax is not paid during the year.
- How it happens: Underestimating quarterly payments or relying solely on withholding.
- How to avoid it: Use Form 1040-ES worksheets and review projected income quarterly. Consider safe-harbor rules and adjusting withholding.
10) Filing state returns incorrectly or forgetting state obligations
- Why it matters: Federal filing doesn’t relieve you of state tax rules or deadlines.
- How it happens: Overlooking state filing when you move, earn remote income, or change residency.
- How to avoid it: Check your state’s rules and deadlines. Many states accept e-filing and provide guidance on residency and remote work income.
If you discover a mistake after filing
1) Minor math or data-entry changes
- How the IRS handles it: The IRS often corrects simple math or transcription errors and will send a notice explaining the change.
- Your action: Respond to any IRS letter and compare the adjustment to your records.
2) Substantive errors (omitted income, wrong filing status, incorrect credits)
- File Form 1040-X to amend the return. The IRS provides guidance on amended returns and when to use Form 1040-X: https://www.irs.gov/forms-pubs/about-form-1040x
- If the error stems from incorrect W-2 or 1099 information from an employer or payer, request a corrected form such as a W-2c and coordinate the correction. See FinHelp’s guide on correcting wages: https://finhelp.io/glossary/correcting-wages-or-withholding-with-form-1040-x-and-w-2c/
- Timing and processing: Historically, amended returns take several weeks to months. The IRS e-file option for some Form 1040-X filings has expanded; check the IRS site and current processing estimates.
Useful FinHelp internal guides:
- A guide to filing Form 1040: https://finhelp.io/glossary/a-guide-to-filing-form-1040/
- Form 1040-X instructions: https://finhelp.io/glossary/form-1040-x-instructions/
Best practices (practical, professional suggestions)
- Use IRS-authorized e-file and reputable tax software. Software flags many common omissions and basic math errors.
- Keep a single, year-round tax folder (electronic or physical) with Forms W-2, 1099s, mortgage interest statements, and receipts for deductible expenses.
- Reconcile all 1099 and W-2 information against your bank and bookkeeping records before filing.
- Ask the payer to issue corrected forms (W-2c, 1099 correction) if their reporting is wrong—this avoids an amended return in many cases.
- Use an Identity Protection PIN (IP PIN) from the IRS if you are a victim of tax-related identity theft. This prevents fraudulent e-filings under your SSN.
- When working with a preparer, get the preparer’s PTIN and a copy of the return. Ask about their review process and how they verify data inputs.
Documentation and record retention
- Keep copies of filed returns and supporting documents for at least three years after filing. The IRS sometimes recommends longer retention for certain issues (up to seven years) depending on substantial understatements or worthless securities.
- Store documents in a secure location and maintain backups for electronic records.
Common questions (brief answers)
- What if the IRS contacts me? Always respond. IRS letters explain the issue and steps to resolve it. If you disagree, follow the notice’s instructions on how to contest the IRS’s position.
- How long to get a corrected refund? If you amend a return or the IRS corrects your file, processing times vary. Most refunds are delayed until the correction is complete; expect weeks to months depending on complexity.
- Can I e-file Form 1040-X? Yes—e-filing for Form 1040-X has expanded for some tax years. Check FinHelp’s e-file guidance and the IRS page for current options: https://www.irs.gov/forms-pubs/about-form-1040x
Sources and further reading
- IRS — About Form 1040: https://www.irs.gov/forms-pubs/about-form-1040
- IRS — Form 1040-X (Amended Return): https://www.irs.gov/forms-pubs/about-form-1040x
- IRS Publication 501 — Filing Status: https://www.irs.gov/publications/p501
- IRS — Common Tax Mistakes (newsroom): https://www.irs.gov/newsroom/common-tax-mistakes
- FinHelp — A guide to filing Form 1040: https://finhelp.io/glossary/a-guide-to-filing-form-1040/
- FinHelp — Form 1040-X instructions: https://finhelp.io/glossary/form-1040-x-instructions/
- FinHelp — Correcting Wages or Withholding with Form 1040-X and W-2c: https://finhelp.io/glossary/correcting-wages-or-withholding-with-form-1040-x-and-w-2c/
Professional disclaimer
This article is educational and informational only and does not constitute personalized tax advice. For guidance tailored to your situation, consult a licensed tax professional or CPA. Author credentials: CPA and CFP® with 15+ years of experience preparing individual tax returns and advising households on tax planning.
