The new year is upon us. You may be just coming out of your turkey coma or focusing on your near year’s goal of shedding those extra holiday pounds. While April 15 may still be a long way off—and preparing your tax return is never a task you look forward to—there are several reasons that filing early can provide serious benefits for you in the long run:
Lower your chances of identity theft
We’ve posted many articles about the growing problem of IRS scams. Identity thieves can steal your Social Security number and fraudulently file a tax return on your behalf—thereby securing your refund. However, by filing early, you minimize the chance of a scammer claiming your refund before you do.
Get a bigger refund
If you’re eligible for a refund this year, giving yourself more time to file your return can allow you to maximize your financial gain. You’ll have extra time to itemize your deductions—and identify unique deduction you may qualify for. If you’re hurrying to file your taxes on April 14, you’ll be more likely to take the standard deduction—which could mean less money in your pocket.
Prepare for a bill
If you expect to owe money in taxes this year, you may not see the benefit of facing the music early. However, even if you prepare your tax return early, you still have until Tax Day to pay your bill. And knowing how much you owe early can offer real advantages. You can budget over the next few months and save up to pay your bill. This can save you the trouble of applying to pay off your tax bill in installments—which may or may not get approved.
Get help from a pro
The month before Tax Day is the busiest time of year for tax professionals—as most taxpayers wait until the last minute to file. Therefore, if you’re looking for help preparing your tax return, it may be difficult to find someone with the bandwidth to handle your case—if you wait until mid-March. Looking for a tax professional late in the game means you may have to file an extension. Some tax professionals even charge your more for tax return preparation during their crunch time.
Do yourself a favor: use January to gather up all of your necessary tax paperwork—and make an appointment with your tax attorney for early February. Then, hand over your documents, sit back and relax as your most dreaded chore of the year gets handled for you.