Busting Tax Refund Myths

How much do you really know about filing federal taxes? Each of us does it every year, but the process often remains a mystery even so. We often fall prey to tax myths, thinking that we need an accountant to get a big refund or assuming that our largest potential refund probably is probably negligible. It’s time to set the story straight about taxes.

How much can you really expect from your refund? Certainly the exact figure depends on your situation, but the overall data might surprise you. In 2015, the average tax refund was $2,815. Similarly, in 2014, 57 percent of taxpayers received a refund of at least $1,000, and 13 percent received more than $5,000.

People go about getting a refund in a variety of ways. Perhaps surprisingly, more people use software to file their taxes than look to an accountant. In 2015, for example, 37.4 percent of taxpayers used computer software to file their taxes — compared with the 22.2 percent who used an accountant, the 18.4 percent who used a tax preparation service, the 12.5 percent who filed a paper return, and the 9.5 percent who enlisted the aid of a family member.

Online software can help answer many of your questions, walking you through the process so that you don’t miss any refund opportunities. It can also help you survive an audit, and it can automatically share information between your state and federal tax documents. Better still, basic filing is often free. The best software companies now offer mobile apps, so you can skip the computer altogether by connecting a capable smartphone to a reliable and secure network.

Check below for more tax myths and smart ideas for spending your refund.


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