6 Benefits of Filing your Income Taxes Early
Updated: Feb 4, 2020
Ok so we all have been victims of a similar problem, not doing important things that we actually should be doing. Procastinating till last minute is a common problem in all of us tax payers.
But if there is one thing we should not e leaving out to last minute is income tax declaration, if you are late on your tax declaration not only you face super human stress, but also you risk paying a penalty fee if some problem shows up in the way.
Here is some important data for you dear reader:
The last year´s tax season (2019) registered a huge amount of people of people that waited until the week before of April 15 to file their tax returns. To be more precise nearly 34 million Americans waited till last minute, that is about the same amount of tax declarations filed in the entire month of March.
So just in case you are not motivated enough to file your taxes early this season, here are 6 benefits to getting your taxes done early this year.
1. Early Filers can access Bank Products sooner!
This could potentially mean that filing your taxes early this year might get you money sooner. Banks are in search to offer their products to us americans. A great way to get all that tax money in your hands as soon as possible, obviously you would have to pay them a fee, but in case you are in some sort of financial hurry, this could get you out of trouble.
2. Early Filers Eliminate Tax Stress
Now here is the thing 57% of americans are not confident in their understanding of the american tax code (according to a Taxslayer survey), stress in this situations is really common and making this tasks a priority helps a lot dealing with that stress. So let´s man up and get your taxes over with.
3. Tax Season Identity Thieves
Identity thieve is really common nowadays, people use your social security number to commit tax refund fraud in an attempt to get their hands in your money.
What is even more scary is the fact that this type of frauds are really common. The Goverment Accountability Office (GAO) estimates that at least $12.2 billion of tax funds were targeted by online tax fraudsters.
What about the IRS you might asks?, yes, the IRS constantly tries to thwart this attempts of robbery, however there were $1.6 million that still ended up in hands of thieves.
I can guarantee you that feeling your taxes early will decrease the odd of being targeted by fraudsters, since if you file your Social Security number before any thieve tries to, the IRS will inmediately record down that you´ve already been paid.
4. If you get a Tax Bill, you can start planning
At the point when you're confronting a tax duty bill rather than a refund, it's normal to put off tax declaration as far as possible.But if you go ahead and fill out your tax forms and file them, you'll realize precisely the amount you need to pay and you won't need to come up with all required funds until the April delcaration cut off time.
The additional time you need to gather the cash, the more uncertain you are to bust your spending limit and drain your bank account. In this way, don't spend the initial segment of the year with your head in the sand. Get the realities about what you owe, make your arrangement, and get that expense bill out of the way.
5. Early Filers Average Larger Funds
Your tax refund isn't free cash. Getting an enormous credit from the IRS just means you have been lending them money throught the entire year they are simply restoring what's yours!
On the rare case that you get a tax refund that is larger than a couple hundred dollars, you most likely need to work with a professional and your Human Resources department to modify your retentions on your W-2 form. Viewing those bigger checks hit your bank account will feel like a promotion!
That being said, if the administration owes you money this year, you need to ensure you're getting each dollar that is legitimately yours and filing your taxes early can help you with it. IRS information shows that citizens who document by late February get altogether bigger discounts than the individuals who record later around $400 on average.4,5
Clearly, in the event that you realize you're getting a refund, you're bound to record sooner, and that could be a piece of the explanation early filers experience bigger refunds. Yet, another explanation is that the sooner you start on your duties, the greater chance you get to ensure claim all expense credits you're qualified for, which takes additional time and documentation than claiming the standard deduction.
6. Early filers face less competition for access to their tax professional.
You may have discovered the hard way that professional get really busy this season, and even for them filing out all their clients taxes as soon as posible can be a really hard. Truth be told, on the off chance that you haven't set a meeting with a pro by the center of March, you may need to file an extension.
What's more, some tax pros will charge more to finish your duties as the documenting cutoff time comes near. The most ideal approach to is to get a meeting with your advisor as quickly as time permits.
Need a new tax professional to work with this year?
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