Categories: Mind & Soul

Don’t Fall for These 12 Common Tax Myths

MYTH: WITHHOLDING AS MUCH AS POSSIBLE FROM PAYCHECKS MAXIMIZES REFUNDS

Technically this is true, insofar as the more that’s withheld from the weekly paycheck, the more is likely to be refunded in April. But it’s not a sensible strategy. People who do this on purpose are giving the government an interest-free loan and missing out on the chance to spend their own money or earn interest on it. A much better idea would be to put the money in an interest-bearing account, even if the interest is only 1 percent. That way, if it turns out the government is owed money in April, you have still made something.

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