When it comes to taxes and tax law, people say and believe
all kinds of things that just plain aren’t true. Some of the things they believe are wrong but
ultimately harmless. Believing some
untruths, though, can end up hurting you big time, especially if you let these
myths affect how or when you file your taxes.
So, to avoid falling victim to tax lies, listen up while we divulge some
of the biggest tax myths that people commonly believe in.
Tax Lie #1: You Can
Deduct the Cost of Your Work Clothes
You may have heard the myth that, whatever clothes you buy
for work, you can deduct from your tax bill. While it would certainly be nice
if this was true- hey, we could all deduct expensive designer clothing and
claim it was for work- it just isn’t.
The only time you can deduct the cost of work clothing is if
you are required to purchase a specific type of clothing that MUST be worn for
work and that can ONLY be worn for work. So, deducting the cost of that couture
dress as a work expense just isn’t going to happen.
Tax Lie #2: If You
File an Extension, You can Worry About Paying Taxes Later
If you’ve ever owed taxes and felt unsure about how you were
going to pay them, someone may have suggested that you file an extension so
that you’d have more time to pay. Unfortunately, though, this strategy doesn’t
work!
Getting an extension gives you more time to pay your taxes,
yes, but any money you owe will still be due at the regular time, and, if you
don’t pay it, you’ll keep accruing charges and fees, which is the last thing
you want when you’re already in a financial bind.
Tax Lie #3: Getting
Bumped into the Next Tax Bracket is the Worst Thing Ever
Finally, if you live in fear of making more money and getting
bumped into a higher tax bracket, stop it right now! A lot of people turn
something that should be wonderful- getting a raise- into something to be
feared and dreaded.
While it is true that you will probably have to pay more in
taxes if you get bumped into a higher bracket, it’s also true that, more than
likely, you’re not going to have to pay some crazy amount. In fact, you’ll
really only be taxed an increased amount for any income you make that exceeds
the tax bracket threshold. In other words, you won’t have to pay higher taxes
on your WHOLE income, so relax and don’t be afraid to earn more money!
As you can see, people believe lots of things about taxes
that just aren’t true. Educate yourself on the truth about tax law, and, when
in doubt, don’t be afraid to ask an accountant!
