Do you know how many Americans don't pay federal income tax? In a survey that raised this question, only 2 out of 10 people got it right (around 45% of Americans don't pay federal income tax). Most other people underestimated this number. What's even more worrying is not the lack of this information but Americans believing tax filing misinformation.

Some people believe tax-filing lies and do the wrong things, which land them into trouble with the IRS. That's why you need to get the right information to avoid falling into this pitfall. Read on as this blog will debunk the most common tax filing myths. 

All Gifts Are Tax Exempted

Most people will give you the advice to give out a gift to avoid paying taxes. These people believe the myth that all gifts are tax-exempted, which is not the case. The IRS general rule is that any gift is a taxable gift. 

The good news is that there are several exemptions to this rule, for example, medical fees and tuition you pay for someone. To avoid problems with the IRS, educate yourself on these exemptions. Besides, if you are uncertain on whether a gift is tax exempted, consult a certified public accountant (CPA).

Filing Jointly Is Always the Best Option

Most married Americans assume that it's best to file joint tax returns to save money. These Americans don't even consider filing separately as they feel it's wrong. Yet, it's better to file separately than jointly in some instances. 

If you've hefty medical bills or want to avoid your spouse's tax liabilities, then it's best to file separately. On the other hand, to earn more deductions and credits, go for joint tax filing. So, review your situation to determine which tax filing options fit you. 

Customer Tips Don't Count as Taxable Income

Most taxis, restaurants, and hotels workers believe the myth that tips don't count as taxable income. They argue that there are no records for the tips they earn, so they don't have to report them as income. After all, some of them cannot even recollect how much in tips they've received in a given period.

If you're one of these people, know that the IRS classifies tips as a taxable income. And like all other forms of taxable income, you face hefty penalties when you don't report your tips. To avoid these problems, learn the IRS regulations on reporting the tips you earn to your employer.

If you're self-employed (for example, you're a self-employed driver), reach out for professional guidance on how to report tips. A CPA will guide you to know the right tax forms to fill in the tips you earned in a given period. 

College Students Don't Have to File

Most Americans believe that being students automatically excludes them from filing tax returns. They argue that the side jobs they're doing at the moment don't generate huge amounts of cash. Besides, they still depend on their parents for financial support. 

Yet, despite all these things, the IRS still requires you to file tax returns even if you're still a college student. Yes, it's challenging to know how to file taxes during this period, and that's why you need to seek professional help. 

To avoid problems with the IRS, you must ignore the above tax filing myths. Understand that it's a myth that all gifts are tax exempted. Also, don't believe the lie that it's always best for married people to file jointly. 

To get the right information on tax filing, reach out to Bliss & Skeen Certified Public Accountants. We are dedicated to helping all our clients file their taxes on time and avoid problems with the IRS. Call us today for individual and business tax services.