Did you know, besides getting your potential tax refund faster, there are several benefits to filing your taxes early?
With W2’s out the door and tax season officially in full swing, you’re either ready to file your tax return or you’re looking at the calendar determining just how long you can put off this tax task. If you’re tax procrastination camp, the points below may convince you to file earlier.
Have More Availability With Tax Professionals
While April 15th feels far away, that looming tax filing deadline will be here before we know it. On paper, tax season appears to have plenty of time, but if you need help or drag your feet getting documents around, you could have a hard time filing on time. If you go to a tax professional to get help with taxes, scheduling an appointment is going to be much more difficult the closer we get to the deadline. When we spoke to CPA and SurePayroll customer, Matthew Weissman, he advised getting an appointment on the books by the middle to the end of February. This will give you, and your tax preparer, plenty of time to iron out important details and get your tax return filed sooner. That earlier appointment time can also come in handy in the event you make a mistake. This leads us to our second benefit of filing early.
You Have More Time to Fix a Mistake
It’s no secret that taxes can be confusing. When filing taxes on your own it’s easy to make a mistake, such as entering a wrong number or forgetting to claim something on your taxes. While some tax mistakes are no big deal, others can wind up costing you hefty fines or other tax penalties. The IRS provides a helpful breakdown of the most common tax mistakes people make when filing taxes. The good news is if you file your taxes early and then catch a mistake, you have more time to correct it and still meet necessary deadlines.
Life is full of stressors. If you procrastinate with tax filing, you could face stress when it comes to not getting the appointment you need with a tax professional, late fees for not filing on time, or more. Filing early can reduce all of those extra headaches and give you some breathing room. To reduce stress year-round when it comes to tax season, there are some things you can do throughout the year to stay organized and reduce the tax stress. For example, regularly storing business receipts in a safe place, frequent meetings with an accountant or bookkeeper throughout the year can be good places to start. Little things like keeping receipts can be done throughout the year and will save you plenty of time and headaches when you’re searching for a receipt for something that happened early on in the previous year.
In the midst of tax season, one way to reduce stress is to plan to file an extension. In our previously mentioned interview with Matthew Weissman, he acknowledged that just because this is the time of year to file taxes, doesn’t mean it’s the best time for you or your small business. This could be your business’s busy season, or you may find yourself dealing with unavoidable personal issues. For those reasons, if you aren’t in the headspace to properly file your taxes, choosing to file a tax extension is a great idea to buy you a little extra time, as long as you are aware of that deadline and don’t miss it when it approaches.
Avoid Tax Fraud
Hackers and identity thieves are everywhere. With important numbers such as your Social Security Number and bank account floating around, tax season is a time when hackers are on the hunt for identify theft. When you file your taxes sooner, you can avoid somebody trying to steal your identity and claim on your behalf. Since you will already be in the system as processing a refund, or already have the refund, if somebody tries to file under your name, the system will kick them out. Today there are many different types of tax scams, and they can carry on long past tax season. The IRS has a Tax Scams/Consumer Alerts page that gives you more information on various scams.
While there are many benefits to filing taxes early, there is one more thing you should keep in mind; don’t file early if you’re not prepared. It won’t do you any good filing early if you aren’t sure you have all of the proper information you need. Rushing also leads to mistakes that you could avoid if you slow down. Take the time that you need to get tax filing done right, even if that takes the form of an extension.