Top 5 Mistakes People Make at Tax Time (and How to Avoid Them)

Most tax stress doesn't come from taxes. It comes from mistakes. I'm talking about small mistakes, rush mistakes, and often overlooked items.Maybe it's a missing form, a late filing or a forgotten credit, and suddenly a manageable process feels completely overwhelming. And friend, today isn't about fear. It's about clarity. Because when you know what to watch for, you can avoid most tax stress before it even starts.So. So let's start with a simple checklist mindset. Here's the question we're answering today. What are the top mistakes people make at tax time?And bigger than that, how can you avoid them? And here's my promise.By the end of this episode, you're going to know what those five common mistakes are, why they happen, and a few simple habits that could protect your peace and your wallet. Today's not about panic, and it's certainly not about shame. It's about knowledge and confidence moving forward. Hey, friend. Ralph Estep Jr. Here.Welcome to Financially Confident Christian, where we're learning how to walk through life and money with wisdom, with peace, and with a heart anchored in God's truth.My mission on this show is to help you break the cycle of financial shame and build those steady habits deeply rooted in faith and become financially confident Christians. And I am really glad you're here today. Yesterday, we launched our Tax Season survival guide. We talked about preparing early to reduce stress.Today we're going to talk about that next step in avoiding the tripwires. I call them the tripwires we're going to talk about. Most mistakes happen from rushing, not from bad intent.And this episode right now is meant to steady you, not to scare you. So let's slow it down and make it simple. Because here's a question I hear way too often, Ralph why do people usually mess up when it comes to taxes?Or how do I make sure I don't miss something important? And these two questions are huge questions because most tax problems aren't about their income. They're about the details.I'm in a detail business, so if you've ever thought, I hope I did this right, guess what? You're normal. How many times have you realized after filing it you forgot something? Or maybe you opened up that IRS letter and your stomach dropped?Truth is, taxes have a lot of moving parts and pressure makes people rush to get them done. So today's about slowing the process down and being wise in it. We're not being careless. We're being normal. Here's something reassuring.Most tax mistakes are preventable. I'm going to say that again, because you need to hear this. Most tax mistakes are preventable. They don't happen because people don't care.There's not people out there going, wow, I don't really care. I'm just going to throw numbers on a paper. Yeah, because people don't have a system.See, in so many things in life, so many things I talk about on this show, it's about systems. But here's the best part. A system can be learned. So let's walk through the five mistakes one at a time.Because I've reviewed and guided thousands of tax returns. I'm talking about thousands of tax returns. I've worked with employees, side hustlers, business owners and families. And here's what I found.The same mistakes show up every single year. And it's not because people are irresponsible. It's because no one ever taught them what to watch for, and they never have. Help them build a system.So let me give you a quick, real example. I see this occasionally. Every year, person filed early but forgot about a 1099. Now, it wasn't about a huge amount of money.They worked a little side job doing doordash or something along those lines, and they thought everything was fine. They got their refund. Fast forward 12 months, a letter comes in from the IRS and says, Guess what? You made a mistake on your return.Of course, immediately they stress out. They call me. They're like, ralph, what happened here? I look at the notice, I'm like, no big deal. You forgot to include this 1099.But listen, they don't do taxes every day. So for them, it was stress. So here's what I did with them. I said, listen, if you're going to do this next year, let's do a simple checklist.Let's look at the income. If you're going to have the same forms, compare those. This is one of the things I tell clients all the time. Where are your forms from the prior year?Okay, well, let's start there. Make sure you have those again this year. Well, Ralph, I changed jobs. Okay, then you're going to have a different form. It's a different experience.So next year, use a checklist and you can disappear from that stress. So here's today's central question. Are you reacting to tax season? Are you preparing for it intentionally? Because there's a huge difference.Preparation is the difference between panic and peace. So let's walk through the top five tax mistakes and how to avoid each one. Now, I'm not doing this to scare You, I want to steady you.Number one mistake. I see this all the time, and that's missing documents. That's the most common mistake. It's that forgotten 1099.Or you had that bank account and you forgot to tell me about the interest. Or you had that side income. You know, I only did it for a few months. I totally forgot about it. And usually it's not about dishonesty.It's just you forgot about it. You didn't have all the information together. And that one assumption helps if you earn money. A form is coming. Here's mistake number one.Missing documents. This is the most common mistake I see all the time. Maybe you had an interest account, or you had a bank account, or you had some stock sales.I just totally slipped your mind. Or that side income that you only did for a little while. And usually it's not about being dishonest.You just didn't have all the information together. Here's one assumption that can help you every single year. If you earn money from any source, guess what? A form is coming to you.So create a checklist of those expected documents and add to as new income shows up. Once you do that tracking, it removes that guessing. And when you stop guessing, it reduces that stress.Here's mistake number two, and this one is completely avoidable. Filing too late. Delay feels easier at first. Like, oh, I can just put it off or put it off.You know, I can just keep on with, they'll get their money when they want it. But you don't think about it. It's quietly adding pressure. As that deadline closes in, you still have the same questions. And then you get to the end.You're like, I got to get this done today. Everything feels rushed. Here's the problem. Late filing can also lead to missed deductions because you forget about them, because you're panicking.It can lead to penalties and interest and just completely adds to unnecessary anxiety. Here's a fix for this. It's real simple. File early enough to think clearly. When you file early, increase that margin, and that margin creates calm.Here's mistake number three. Entering your information incorrectly. Now, this again, usually comes from rushing a mistyped number. A wrong digit.You'd be shocked how many people I know that spell their name wrong on their tax return or they put their Social Security number on. And then what happens is the forms don't match up. Those small errors can trigger delays or even those shredded notices. So here's the fix for this.Just slow down. Compare entries to the original forms, review it and then review it again. That accuracy protects your time. Here's mistake number four.Forgetting deductions or credits. And this one costs people real money.Credits or deductions can be tied to education, your children, maybe charitable giving, some health expenses, or maybe business activity. And oftentimes they get missed. Because life changed. Here's one question you can ask yourself before you sit down to do your tax return.What changed in my life this year? Did you have a new job? Did you add some side income? Did you have a new school? Did your family changes? Those life changes affect taxes? What?A lot of people come to me because they had a change. Those life changes absolutely affects your taxes. And here's mistake number five, not planning for next year. And this is the quiet mistake.See, here's the thing. People file and then they disengage. Like, oh, taxes are done. I don't have to think about this again till next April. That's the wrong answer.Here's what I call your after action question. What would make this easier next year?So right now, as you're doing your taxes, go ahead and create that folder for 2027, because then you can put everything in it. Maybe you need to adjust your withholding. Maybe you did your return. You're like, man, I owe money. I got to fix this. Don't wait till next tax season.Fix it now. If you're a side hustle or you're doing some side income, start tracking that right now. Save those receipts as you go get that envelope.Start putting that stuff in there. Your future you is going to be grateful for this. Well, let's move to our Bible verse. It comes to us from Proverbs 19:2.It says, Desire without knowledge is not good. How much more will hasty feet mist away? Now you might be saying, ralph, this one is totally off. The plantation doesn't make any sense.Well, it does if you think about it, friend. Russian creates mistakes. But that wisdom invites patience. Because haste is expensive. It's expensive both financially and emotionally.You gotta have this cloud over top of you, and patience looks like checklists and reviews and making sure it's all ready. Because calm is a strategy. It's not a personality street. You don't have to be a personally calm person to have a strategy.And that wisdom invites patience. So here's your simple step for today. I want you to make a tax change checklist.Every form you expect to receive, whether that's W2 forms, 1099 forms, interest statements, everything tied to income. All you got to do is go get your tax return from last year, find all the forms and start making a list. Well, I had a W2. I had a 1099 make that list.This is what I do. I'm a professional. I've been doing this for 30 years. This is what we do. We compare last year with this year.Check them off as they arrive because that one habit prevents more mistakes than almost anything else you can do. Let's pray together. Lord, just thank you for wisdom that helps us avoid unnecessary mistakes.Guide us diligently to be thorough, Lord, and give us patience to slow down and clarity as we prepare. Help us approach taxes with integrity and confidence. And we ask this in Jesus name. Amen. Friend, let me say this plainly.If money's been weighing on your heart, there's another path available to you. I wrote a book. It's called how to become a Financially Confident Christian. And this is my assembly of 30 years of working with people just like you.It's all about peace and clarity and rebuilding trust with God around your finances. It's not some lecture. It's an invitation to just one step at a time. And you can find the book at financiallyconfidentchristian.com/becoming again.That's financiallyconfidentchristian.com/becoming. Go get the book today, friend. Mistakes don't have to define you anymore. Preparation protects you.And with the right habits, tax season can truly feel manageable and even feel calm because you're learning, you're growing, and you're doing better than you think. Now, tomorrow we're going to simplify another big topic. A lot of people get stuck on this, and that is the question of deductions versus credits.What do they really mean? Well, I'm going to break it down and make it simple for you about that's what I'm going to do on tomorrow's show.And if today's show helped you, I want you to share with somebody who tends to rush during taxes. You know those procrastinators. Send this show to them because this will help them. Because this show is not about financial shame.It's about walking in wisdom, staying steady, and truly becoming a financially competent Christian. So God bless you, my friend, and join us again tomorrow as we talk more taxes, deductions versus credits. Have a great day today.