5 Common Mistakes to Avoid When Preparing Your Tax Return in 2025

With tax season underway and the Internal Revenue Service (IRS) accepting returns, Massachusetts taxpayers need to ensure that they are prepared to meet their federal filing and payment obligations by Tax Day, which is April 15, 2025. Among other things, this means avoiding common mistakes that have the potential to trigger not only interest and penalties but also scrutiny from the IRS. Here is an overview of five common mistakes to avoid from Boston tax lawyer Kevin E. Thorn, Managing Partner of Thorn Law Group.

Mistake #1: Filing Too Early

If you are not planning on waiting until Tax Day to file your federal return, it is important to make sure you do not file too early. To file an accurate return, you need to have all of the reporting documents that you will receive before April 15. If you file before you receive all of these reporting documents (i.e., Form 1099-B for investment income or Form 5498 for IRA contributions), you could end up either underreporting or overreporting your taxable income—both of which are mistakes that would then need to be addressed through an amended return.

Mistake #2: Failing to Report All Income from All Sources

Under the Internal Revenue Code, U.S. taxpayers must report all of their income from all sources to the IRS. For many people, this means not only reporting their employment income but also reporting income such as:

• Independent contractor (or “gig”) income
• Retail investment gains
• Cryptocurrency investment gains
• Gaming and gambling winnings
• Retirement account distributions

If you don’t report these (or other) forms of income to the IRS, the IRS will still learn about your additional income from the parties that paid you. While inadvertently underreporting your income can lead to civil penalties, intentionally underreporting your income is a federal criminal offense.

Mistake #3: Improperly Claiming Credits or Deductions

The same is true with regard to improperly claiming credits or deductions. If you are not sure whether you qualify for a credit or deduction, you need to do your research—or seek professional tax advice if necessary. For taxpayers who are eligible to claim business expense deductions, going overboard presents a high risk of triggering IRS scrutiny.

Mistake #4: Misreporting Information to the IRS

Even if you have every intention of accurately reporting your taxable income to the IRS, you need to be very careful to avoid misreporting information to the IRS. As we just discussed, even inadvertent mistakes can trigger civil penalties (which begin to accrue immediately). Claiming the wrong filing status, transposing numbers, and making math errors are all common mistakes that can lead to unnecessary issues with the IRS.

Mistake #5: Overlooking Issues on Last Year’s Federal Tax Return

Finally, if you discover that you made mistakes on last year’s federal tax return when preparing your return in 2025, you should not overlook them. Rather, this is a situation that you should address proactively—potentially with assistance from a Boston tax lawyer. At this point, not only could you be facing a year’s worth of accrued interest and penalties, but knowingly ignoring an issue with your past returns could increase the risks of facing an IRS audit in the future.

Request a Call with Boston Tax Lawyer Kevin E. Thorn

Do you have questions or concerns about federal income tax compliance in 2025? If so, we invite you to get in touch. To request a call with Boston tax lawyer Kevin E. Thorn, Managing Partner of Thorn Law Group, please call 617-692-2989 or contact us online today.