Discussion:Urban Tax Legends

I'll start:

1) Receiving a 1099 increases your audit risk.

2) Using the pre-printed IRS label increases your audit risk.

3) Filing late in the filing season near April 15 decreased your audit risk.

4) Filing an extension and filing near Oct 15 decreases your audit risk.

5) Taxpayers over age 65 who are still working don't have to pay Social Security tax.

6) The Amish don't pay income tax.

7) Nurses/police/EMTs on call can deduct the cost of their monthly phone bill since they need to have a phone to keep their job.

8) Firefighters can deduct the cost of their lunch since they are on duty 24 hours a shift.

9) If you show you owe at least $1 instead of getting a refund, you are less likely to be audited.

10) There is a Slavery Reparation tax credit for African Americans who never received their '40 acres and a mule'.

11) You can deduct the cost of your car and all its operating expenses (or mileage) as a business expense if you put advertising on the car.

12) You can deduct the cost of your vacation if you go on a job interview (keep that business card of the interviewer) while away.

What have I left off? Please add more.

23) Filing on extension and claiming a large refund increases your audit risk.

24) The Internet Tax Fairness Act forbids states from imposing sales or use taxes on goods ordered over the internet and shipped from outside the buyer's state.

25) Newly arrived legal immigrants or refugees get a seven-year federal income tax holiday.

28) The federal income tax is voluntary and applies only to those who volunteer to pay it.

31. S corp owners don't have to claim a salary.

32. You can claim your live in girlfriend as a dependent.

33. Someone has to win the Irish Lottery.

35. Most IRS agents/officers are mean and hard to deal with.

36. When a client calls and says "I have a quick question", it does not need a quick answer.

38. If you make a lot of money in one year, they got this special thing called income averaging.

39. My buddy claims his dog as an exemption (or anything beginning with 'My buddy'

43. I didn't collect any money on my sale and reinvestment of mutual fund shares. Also, I invested $ 3,000, and redeemed $ 3,000.

49. It's the accountant's job to figure out how to write that off.

50. If I don't file my return, I don't owe any tax.

51. My tax at year end is determined by how I fill out my W-4.

Great discussion!

56. Why can't I deduct my F-150, I carry my tools to work every day?

59) We can take a deduction on dad's tax return, or the estate tax return, for the clothes we donated to goodwill after dad died.

61. I can use the government's per diem rates to figure out of town expenses for me and my clients, right? [this one is sad, because I see it asked here so often]

62. The realtor said all these settlement expenses on my new residence are deductible.

63. It must be deductible!! I read it in a post somewhere on TaxAlmanac!