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They did what?!? Top 10 mistakes made by professional tax preparers

A big deal is made every tax season about the silly mistakes taxpayers make when filing their returns. But don't take it personally. You're not alone.

The Internal Revenue Service reveals that nobody's perfect -- even paid preparers. The IRS has compiled a list of the top 10 errors tax professionals made on returns the agency has received through March 7.

The mistakes are shown for each of the three individual return forms: 1040, 1040A and 1040EZ. Because some of the recently processed returns are for the previous tax year, the IRS found errors related to the confusing rate reduction credit. The good news: That's not a problem on 2002 returns, since the 10 percent rate that the credit was created to pay out is now fully integrated into the regular income tax brackets.

As you can see in the lists below, many of the mistakes are the same ones you and I tend to make. Millions of filers who did their own taxes last year messed up the rate reduction credit and so did paid tax professionals. Tax-mistake staples, like mismatched names and Social Security numbers and miscalculated credits, also made the lists.

Form 1040

  1. The taxpayer was eligible for the rate reduction credit, but did not claim it.
  2. Taxpayer identification numbers or names for dependents used in a claim for exemptions didn't match IRS or Social Security Administration records.
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  4. Taxpayer identification numbers or names for dependents used in a claim for the child tax credit didn't match IRS or Social Security records.
  5. Earned income credit was figured or entered incorrectly.
  6. Social Security number for children used to claim the earned income credit didn't match Social Security records.
  7. Children were too old to be claimed as part of the child tax credit.
  8. The additional child tax credit was figured incorrectly.
  9. The rate reduction credit was improperly claimed. The taxpayer had already received the maximum rebate check or didn't have taxable income and so was not eligible for the credit.
  10. The amount of tax due was calculated using an incorrect filing status.
  11. Spouse's Social Security number was missing or didn't match Social Security records. The corresponding exemption was not allowed.

Form 1040A

  1. Taxpayer identification numbers or names for dependents used in a claim for exemptions didn't match IRS or Social Security Administration records.
  2. Taxpayer identification numbers or names for dependents used in a claim for the child tax credit didn't match IRS or Social Security Administration records.
  3. Earned income credit was figured incorrectly.
  4. Social Security number for children used to claim the earned income credit didn't match Social Security records. The amount of the credit was changed.
  5. The taxpayer was eligible for the rate reduction credit, but did not claim it.
  6. The additional child tax credit was figured incorrectly.
  7. Tax not figured correctly based on filing status information reported.
  8. Children were too old to be claimed as part of the child tax credit. The credit was reduced or disallowed.
  9. Correct form to claim the earned income credit was not filed so credit was disallowed.
  10. Taxpayer's Social Security number or name did not match Social Security Administration records. The filer's personal exemption and earned income credit amounts were disallowed.

Form 1040EZ

  1. The taxpayer was eligible for the rate reduction credit, but did not claim it.
  2. Earned income credit was was not allowed because the taxpayer did not meet the age requirements.
  3. The rate reduction credit was improperly claimed. The taxpayer had already received the maximum rebate check or didn't have taxable income and so was not eligible for the credit.
  4. Taxpayer's Social Security number or name did not match Social Security Administration records. The filer's personal exemption was disallowed.
  5. The tax amount entered on the form was from the wrong tax table.
  6. Taxpayer's Social Security number or name did not match Social Security Administration records. The filer's personal exemption and earned income credit amounts were disallowed.
  7. Spouse's Social Security number was missing or didn't match Social Security records. The corresponding exemption was disallowed.
  8. Earned income credit was figured or entered incorrectly.
  9. Correct form to claim the earned income credit was not filed so credit was disallowed.
  10. Refund amount or amount of tax owed was figured incorrectly.

All of these mistakes were made by preparers who submitted paper tax returns for clients. The IRS, eager to get all of us -- individual and professional – to file electronically, says that many of the errors could have been avoided if the agency's e-file program was used.

And as you struggle with your return, hang in there. The best of us -- and them -- are only human when it comes to taxes!

-- Updated March 13, 2003

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