Tax Masters Debunks 5 Common Tax Myths

Tax Myth 1: The IRS will not notice if I do not file.

In the age of computers, this tax myth could not be further from the truth! TaxMasters has dealt with numerous cases where people mistakenly believed the IRS would somehow miss the fact that they did not file a tax return or decide to let them slide. The IRS continually gets more sophisticated in the way that they track tax returns, and they will notice if you do not file. They may not notice immediately, but they will find out and they will make you pay what you owe along with fines and penalties. In worst case scenarios, they can even send you to jail for not filing. Recently, Wesley Snipes was jailed for failing to file just three tax returns. Don't let this be you!

Tax Myth 2: Since I am in the military, the IRS will cut me slack in having unfiled tax returns.

First of all, thank you for serving our country. One of our own, Major Fred Hackett, is currently deployed in Iraq. We have the utmost respect for our service men and women. That’s why we don’t want you to get taken by this tax myth. Just like every other American, you have to file your taxes. The IRS is willing to give you extensions, but you must file for them. Do not just assume that you have one.

Tax Myth 3: People who file for extensions get audited more.

Nope. Audits are based off of what is on your return, not when you submit it.

Tax Myth 4: If I file an extension, I won’t owe anything until the extension is due.

Unfortunately, this is not true. If you owe the IRS money, you will begin to be charged interest on April 16th, regardless of your extension. So if you are filing for an extension to avoid paying for a few more months, don’t bother. You will only end up owing more.

Tax Myth 5: African Americans can claim reparation deductions

Slavery was an awful institution in America, but there are no reparation deductions due to slavery. Anyone that tells you otherwise is probably running some type of scam. The US court system has seen numerous cases on this topic, with the person claiming reparations always losing. Don’t waste your time and money trying to file for this false deduction. It could lead to some serious tax problems down the line.

Disclaimer: The information here should not be taken as tax advice, but as common sense responses to IRS notices and procedures.