Many taxpayers delay filing until the April 15th deadline, assuming there’s no harm in waiting. However, filing your taxes early offers several advantages, from faster refunds to better financial planning. Here are the top reasons why you should consider filing your taxes as soon as possible this year:
1. Faster Refund Processing
One of the most compelling reasons to file early is the speed at which refunds are processed. Filing electronically (e-filing) is the quickest way to ensure your return is processed efficiently. With the IRS’s e-filing system, refunds can be deposited directly into your bank account, often within 21 days of filing.
- Pro Tip: After filing, use the IRS’s “Where’s My Refund?” tool or the IRS2Go app to track the status of your refund.
By filing early, you’ll avoid the bottleneck that often occurs closer to the tax deadline, meaning you can access your refund sooner.
2. Avoid Penalties for Late Filing or Extensions
Waiting until the last minute can lead to rushed filings or requests for extensions. While an extension provides more time to submit your paperwork, it does not extend the time to pay your taxes.
- If you owe taxes: Failure to pay the balance due by April 15th results in interest charges and penalties, compounding the amount owed.
Filing early ensures you have enough time to prepare your return accurately, avoid unnecessary penalties, and pay any taxes due without added stress.
3. Reduce the Risk of Identity Theft
Tax season is a prime time for fraudsters to steal identities and claim fraudulent refunds. Filing your taxes early reduces the risk of someone using your Social Security number to file a false return.
- How to protect yourself: Gather your financial information securely and file as soon as you have all your necessary documents. Early filing ensures your legitimate return is processed before scammers have a chance to act.
While instances of tax-related identity theft have declined in recent years, it remains a significant concern. Taking proactive steps to file early can safeguard your refund.
4. Better Financial Planning
Filing early gives you a clear understanding of your tax situation, allowing you to plan your finances effectively.
- Know what you owe: If you anticipate owing taxes, filing early gives you time to gather the funds before the April 15th deadline.
- Plan big financial moves: For those making major decisions, such as purchasing a home or car, knowing your tax liability or refund amount is essential for accurate budgeting.
By preparing your tax return early, you can choose the best payment method—whether credit card, debit card, or installment plan—without feeling rushed.
5. Minimize Stress During Tax Season
Procrastination often leads to unnecessary stress, especially if you’re scrambling to gather documents, calculate balances, and meet the deadline. Filing early allows you to approach tax season with ease.
- Avoid errors: Rushing to file at the last minute can lead to mistakes, such as miscalculating your tax liability or forgetting to include critical information.
- Stay in control: Early filing gives you the time to review your return thoroughly, reducing the likelihood of costly errors or delays.
By filing your taxes early, you’ll enjoy peace of mind and more time to focus on other priorities.
Early Filing Is a Win-Win
Filing your taxes early not only speeds up your refund but also helps you avoid penalties, safeguard your identity, and plan your finances with clarity. Whether you expect a refund or owe taxes, early filing puts you in control of the process, reducing stress and potential complications.
Don’t wait until the last minute—start gathering your financial documents today and take the first step toward a smooth and stress-free tax season!
Photo by Recha Oktaviani on Unsplash