What you don't know can hurt you when it comes to filing your taxes. Each year, thousands of Americans miss out on extra money from refunds simply by not knowing the proper way to file.
Tax advisor Barbara Matthews of H & R Block pointed out some myths.
Myth - Students don't have to pay taxes.
- "It depends on their age and how much earnings they have, but just because a taxpayer is a student doesn't mean they're not liable for tax," said Matthews. "The student would still need to fill out a tax return if their earnings were more than about $4,750 in the year's time."
Myth - Parents can't claim children who have a job.
- "As long as your child is under 24 years old and a full time student, or under 19 years old and not a student, then you still can claim them as dependents," Matthews said.
Myth - Homeowners over 55 can sell their house tax-free.
- "If a married couple has owned and live in their house two out of the last five years, then you can sell your house if you have a profit of less than $500,000 and you pay no tax on that," said Matthews. "For a single person, it's half that much, $250,000."
Myth - You can deduct your own sales tax. However, there are a few exceptions.
- "That is a myth for the most part," Matthews said. "General taxpayers cannot deduct any sales tax. If you were to buy a car or any other big ticket items, then you can deduct your sales tax unless you happen to be in a business. Business people can deduct some sales tax."
Myth - You must file jointly if you are married.
- "You don't have to. There's always the option of filing a separate tax return. It may result in higher taxes, but the option is there for you," Matthews said.