5 Reasons To File Your Taxes Early
Motivation to get them done
Tax season is here and no matter how long you delay filing, you’ll have to face that 1040 eventually. So why wait until the last minute? The IRS has already started accepting tax returns, so there’s no better time to file than today.
To help motivate you, here’s 5 reasons why filing your taxes should be your next priority.
1. Reduce Stress Levels
Just the thought of compiling and calculating your taxes can stress anyone out. Instead of delaying the inevitable, just get it over and done with by filing sooner rather than later. If you do feel pushing off your taxes even further, you can always file an extension, but remember, you’ll still have to pay any taxes owed by April 15.
2. Prevent Fraud
With data breaches becoming more common, someone with your Social Security number could file a tax return and take your refund. If the IRS does receives two tax returns with the same Social Security number, it will reject the last tax return filed, notify the taxpayer by mail and investigate the matter. If you receive a notice, or the IRS rejects your filing because of a tax return already on file, this is a definite sign that someone is using your Social Security number. Although the IRS will investigate, it’ll be a long, painful process trying to get your tax refund. The best way to prevent this from happening it to file as soon as possible.
3. Plan For Taxes Owed
With the changes in the tax law, your employer might not have withheld enough money last year to cover your tax bill. By filing early, you can find out how much you owe and create a plan to pay your tax bill off by the April 15 deadline. If you owe too much and can’t afford to pay your entire tax bill by April 15, the IRS does allow payment plans to be set up. The best way to avoid owing taxes in the future is to update your W-4 withholding.
4. Cash in the Bank
If you don’t owe money, that means you’ll be getting a refund. By filing early, you’ll know how much you’re receiving and be able to put that money to work faster than if you waited to file. Whether it’s saving for retirement, paying off debt, starting a business, or traveling, you’ll be able to plan better knowing exactly how much you have. And if you don’t know the best way to use your tax refund, schedule a free call with one of our CFP® Professionals to talk through your ideas.
5. Professional Availability
If you’re going to use a Tax Professional or schedule a time to talk to them, don’t wait. By mid-February, most Tax Professionals find their calendars filling up and bombarded with work. The earlier you get in to see them, the more time and attention they can give you, and you’ll also avoid any rush fees (if charged) for waiting until the deadline.