3 Reasons to File Your Taxes Early
Tax-filing season is officially underway. It’s an annual rite of passage that stretches to mid-April or (with a six-month extension) beyond.
Here are three reasons why it often makes sense to file sooner rather than later.
Waiting to file can make you more vulnerable to tax refund fraud.
The sooner you file your tax return, the sooner the IRS can process it. This can prevent a fraudster from filing in your name and making off with your refund.
We discussed this issue in our January 12 post.
Refund fraud has been a problem for years. This year, the IRS has introduced a “verification code” on many more W-2s to try to do a better job of matching income and preventing fraud.
Sometimes further paperwork is needed to complete the filing.
Even if you think you have all your ducks in a row, you or your tax preparer may find that additional information is needed in order to complete your tax return.
If that is the case, you’ll wind to aim for getting your taxes filed early, so that you’ll have time to respond to any contingencies that come up before the filing deadline.
You may need more time to consider your payment options.
By filing early, you could conceivably get your refund early if you are eligible for one. But if you owe tax that you may have difficulty paying, it’s also important to know that sooner rather than later. That way you can consider your options for making payment by borrowing money, taking out an installment agreement or some other option.
