Many Americans dread tax season like no other time during the year. That's why so many people reason that they have plenty of time -- until April 15th, as a matter of fact -- to get it done.
But why wait? The earlier you get the process started, the better! Here are six reasons why you should file your taxes ASAP!
1. Get a Faster Tax Refund
If you are one of the lucky Americans who, instead of paying out a hefty sum in taxes each year, receives a tax return, you have a great reason to file your tax return right now.
Often, if you delay filing your taxes to the last possible moment, you will find yourself waiting several weeks to receive your return. And if you opt to file by paper, the mailing process may take even longer as it has to travel both ways.
So get on it now! E-file with one of the many free tax return software or websites available and get the ball rolling to receive your return.
2. Secure More Time to Pay Taxes
If you actually owe taxes this year, you may not want to run up against the tax deadline this year.
Say you prepare your Form 1040 in January. That means you have four months to get your finances arranged to better cover the taxes owed. Whether you are an individual or a business owner, that extra time will make paying your taxes in 2020 easier on your pocketbook. You can come up with ways to pay your tax bill when you have a few months to plan, such as:
- Saving money each payday from your paycheck
- Reducing the number of times per week you eat out
- Taking out a personal loan
Plus, the stress of waiting until the very last minute may not seem so heavy. If you have always waited for the deadline to file your taxes, you may be used to the stress.
But if you take the initiative to file your taxes now rather than later, you will save yourself time, energy, and maybe some mental health.
3. Avoid Tax Return Identity Theft
When you start your filing process as early as possible, you can get the jump on any would-be identity thieves long before they find an opportunity.
You may believe yourself to be one of the lucky few who will never face the threat of identity theft, but you truly never know when a thief could strike. And believe us -- any thief with your social security number will not be looking to pay your taxes for you.
Never let someone else take what is rightfully yours, especially after you've worked so hard all year to earn it.
4. Make It Easier to Get an Appointment With a Tax Professional
One of the benefits of filing taxes early is that your accountant will not be busy. When you wait until March or April to file taxes, you give yourself more wiggle room with the tax preparations.
Your accountant's schedule will not be jammed with last-second appointments, and you can spend more time with them discussing important questions or concerns about your filings. You can also maximize the amount of information you provide. If you plan ahead, you can gather all your:
- Receipts
- Evidence of charitable giving
- W-2s
- 1099s
This will save you the stress of running around the house at the last minute trying to gather these documents. You also give your accountant more time to work on your return when you turn over all your information earlier. This ensures they won't miss any potential deductions and have time to ask you questions about any small discrepancies.
5. Avoid Crowds at the Post Office
Have you ever gone to the post office during the week of April 15? It's busy, people are impatient and workers feel understandably stressed. It's not a place you want to be. Mailing in or electronically filing your tax return before April can save you the headache of navigating the crowds to ensure your return gets the proper postmark.
6. Reduce Tax-Related Stress
Everyone gets stressed out during tax season. You worry about whether you will receive a refund or have to pay the government. Perhaps you are counting on your refund to pay for your summer vacation, or you don't have money set aside to pay. You might spend sleepless nights concerned about what will happen.
Early tax filing decreases your stress load by getting the issue taken care of sooner rather than later. That's less time for you to worry. Instead of wringing your hands over the what-ifs, you will know what you owe or will get sooner. Planning for that is much easier than planning for the unknown.
How Early Can You Do Your Taxes?
The IRS opens tax filings to most individuals on Jan. 27. If you have an Additional Child Tax Credit or Earned Income Tax Credit, you can't file until three weeks later, on Feb. 15. Most people file in March or April, though.
How to File Taxes Early
Filing your taxes early is no different than filing them on April 15. You will fill out the proper forms and submit them to the IRS. If you file online, you will receive electronic confirmation of your filing within a day or two. It will take about three weeks, or maybe less since so few people have filed, for your loan to come through.
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