Filing tax returns is obligatory for every responsible citizen and impacts in many ways; states with high tax revenues thrive and don't hesitate to improve their citizens' lives. Filling tax returns requires technical knowledge and expertise; people filing their income tax often make mistakes that make them pay.

If you live in California, the state franchise tax board provides guidelines and tips to its residents for filing their tax returns correctly. After auditing several returns, the most common mistakes that resident makes while filing their returns are the wrong calculations in adjusting gross income or claiming exemptions or credits; these errors not only delays the processing and also impact refunds.

Common Mistakes and How to avoid them:

Below are the top most common mistakes Californians make while filing their tax returns, make sure to avoid these mistakes while filing your California tax return.

Cross check Your Tax Payments:

The first step to avoiding mistakes while filing your California tax return is cross-checking that the amount you paid in taxes matches the California tax records. You can initialize the process by checking all the records against all the tax payments made to the California franchise tax board for the respective tax year.

Your next move will be to check if any tax refund amount is remaining from last year's tax return; if yes, include it while calculating this year's tax return. You can track all the information through line 95 of Form 540 of the California resident income tax return or by exploring line 102 of Form 540R in the California non-resident return Form.

For comparing and cross-checking your payment records, log in to ftb.ca.gov, then go to the "My FTB Account tab," where you can make sure and verify your payments. If the state's amount is incorrect, you can call the FTB helpline at 1-800-852-5711. Last but not least, ensure that you have the proof for all the payments you made and include it in the tax return; a proof letter can also be attached to your return.

Claiming Standard or Itemized Deduction:

A part of taxable income can be lowered through deductions; the key is mentioning the correct amount while filing, which is mentioned on Form 540 or 540NR line 18 for standard deductions. For itemized deduction, you need to check the instructions first whether or not they are allowed; however, California Tax Return doesn't follow the federal deductions on itemization.

The claim of standard deductions in California tax returns is lower than in the federal income tax return. It's $4803 for individual filers (single, married or domestic partners) filing separately and $9606 for filing jointly. Complete the Federal Schedule A if you are itemizing on the California return and don't itemize on the federal return. Don't forget to check the box on Schedule CA, fill all the lines from 1 to 30 on your state return, and attach the copy of Federal Schedule A with your state return.

Proper calculated Total Tax Amount:

Make sure that the total tax amount calculated on Form 540,540NR line 31 is correct, check all the schedules, and ensure all the amounts are transferred over properly. Similarly, checking total credits on Form 540 line 47 or Form 540NR line 62 are also calculated properly, and correctly is necessary to know the total tax amount.

Do the Right Math:

To check whether you did the math right in calculating your tax return, start with your federal adjusted gross income amount; if your employment includes wage, it must match with state wages mentioned on your W-2.

To ensure that you entered the right amounts, recheck all the additions or subtractions according to California State and that they are correctly put and calculated. Once you have done, review your California adjusted gross income on Form 540/540NR line 17 and calculate it correctly.

Exemption on Credit Amount:

In California, the Exemption credits depend on the number of dependents and filing status, reducing your total due tax. All of it depends on using the right number of exemptions; make sure the numbers are in your return; you can include and claim for yourself and your spouse in case you are filing jointly and your dependents ( one each).

All the calculations for exemption credit amount are made on Form 5450, line 11, and are transferred to line 32 of the same Form. Make sure you allocate your exemption credit properly on Form 540NR line 39 if you are a part-year resident.

Mentioning your Resident Status:

Mentioning your resident status, whether you are non-resident or year-resident, also impact your tax return; if you are living outside California in another state or part-time resident, check your California taxable income mentioned on Form 540NR line 35 that is stated correctly, it must be accurate and transferred correctly from line 5, Part IV of California schedule.

Claiming Correct Withholding Amount:

Another common mistake is claiming the wrong withholding tax; first, you must enter your California withholding mentioned on W-2 or 1099 statements. Ensure that you are claiming California income tax withheld and you have done your math correctly. For reference, attach copies of the statement supporting the withholding amount you are claiming.

Other Frequent Mistakes while Filing tax in California:

Apart from the above mention mistakes, other common and frequent mistakes that tax fillers make while filing their returns in California are:

• If you are making amendments to your return and filing it as a return, ensure that all the information except the amended one matches your original return.
• Double or cross-check that no one else except you is claiming your dependents.
• Read all the rules before claiming earned income Tax Credit, and make sure you are qualified.
• Reviews and rechecks if the number of itemizing deductions is high.

Final Thoughts:

Filling your yearly income tax returns is the duty of responsible citizens, however rules and regulations for filing your return may vary from one state to another; the state of California has its own set of rules, one who is resident or who is non-resident or part-time resident all have to fill different form while calculating the amount of their taxes, one must cross check and do all the math correctly after entering all the information and claiming for deductions and withholding amounts.