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It’s tax time closes the April 15 deadline to file your return or request an extension and a new report details the common mistakes Americans make throughout the year that cost them money.
A GOBankingRates report breaks down five tax mistakes that can cost American taxpayers thousands of dollars every year.
Those common mistakes range from not claiming deductions that were available to the taxpayer or failing to track deductible expenses to misreporting income.
Here’s a look at the five tax mistakes outlined in the report.
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Taxpayers may cost themselves money in small refunds or penalties for making mistakes in filing their taxes. (Michael Bocchieri/Getty Images)
Approaching taxes as a once-a-year event
Christina Taylor, vice president of tax development and delivery tax technology forum in April, told GOBankingRates that taxpayers who only think about their refunds at the time of filing are “missing out on the credits and enhancements they’re eligible for, which is how you end up getting part of your refund back to the IRS.”
He added that last year “Americans paid about $3,200 in federal taxes on average, and spent billions of dollars and 6.5 billion hours on tax preparation.”
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The deadline for taxpayers to file their 2025 returns or request a refund is April 15. (Kayla Bartkowski/Getty Images)
It does not track deductions throughout the year
Taxpayers often fail to keep track of their deductible expenses during the year, which often happens when filers operate under the assumption that they will claim the standard deduction rather than include it on their return.
Those situations can be avoided if taxpayers keep track charitable contributionswhether it is done in cash or in kind donations, and medical expenses and any interest expenses they may be able to deduct from their state tax payment.
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Incorrectly reporting investment income or stock compensation
Taxpayers may overpay taxes on income from investments or income stock compensation in the form of restricted stock options or non-qualified stock options being sold.
Jennifer Kohlbacher, CPA and director of wealth strategy at Mariner Wealth Advisors, told GOBankingRates that taxpayers often fail to calculate or report their tax basis correctly, which can increase the amount of capital gains tax they owe.
The IRS may delay refunds for erroneous returns or flag them for audit. (Jordan Vonderhaar/Bloomberg via Getty Images)
There are no estimated tax payments or non-renewable deductions
Taxpayers who run a small business or are self-employed are required to make estimated tax payments to the IRS each quarter throughout the year, and failure to pay the appropriate amount can subject the taxpayer to underpayment penalties and any related interest.
Life changes that affect the taxpayer’s status, such as getting married or having a child, are situations in which taxpayers must update their withholding information to account for the change, which can reduce the size of their return by increasing their take-home pay.
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Filing errors and poor record keeping
Taxpayers may make math errors when filing or make mistakes on their tax returns that can cause the IRS to flag the tax return for review or even analysis.
IRS reviews can also cause taxpayers’ tax refunds to be delayed.
