Advantages of Filing Your Taxes Early

Admit it, we are all guilty of procrastinating at times, and with taxes, it is tempting to leave them to the last minute. Not only are taxes intimidating, but they can also be confusing, and if you are seeking a professional, your taxes may even be expensive to file.

According to the IRS website, in 2020, more people filed their taxes in March than in any other year. With more people getting back to work and adjusting to their new schedules and productivity expectations, we might see people procrastinating with their taxes again. However, there are some advantages to filing your taxes early.

Larger Refunds

Keep in mind that a tax refund is not free money from the government; it is actually your money that you are finally getting back. Those people who file early take the time to ensure that they receive every dollar that is rightfully theirs. The IRS data shows that, on average, people who file earlier receive a refund that is $400 more than those who file later. When you don’t have the stress of a deadline looming over your head, you can take the time to get every deduction and tax credit that you are eligible for rather than claiming the standard deduction.

Less Deadline Stress

If you have ever pulled an all-nighter to finish a project, a paper, or a report, then you have experienced deadline stress and know how debilitating it can be towards your daily life. Sometimes you must refer to some old-timed parental advice if you face a challenging task; best to get the worst thing done first. To get your taxes done ahead of the April deadline, you might have to play some psychological tricks on yourself, such as giving yourself a fake deadline or a small reward when you have finished filing.

Oh no! You Owe Money

Even if you owe money to the IRS, you can still see some advantages of filing early. The earlier you file and understand the exact amount due to the IRS, the more time you have to accumulate the full amount before the April deadline. The more time you have to save money, the less likely you are to panic and drain emergency funds or take out personal loans.

Early Filers Find Better Help

Like any other industry, there are tax professionals who rock stars in their field, and some are not so great. If you choose to file early, you are more likely to get a chance to work with those who are the rock stars. As the tax season progresses, tax professionals will be pressed for time, and the ability to file, those who are great will fill up their schedules faster. Filing your taxes early will allow you to get that precious time with those knowledgeable tax professionals.

Protect Yourself

Every year thieves file billions in fraudulent tax refunds. Thieves use social security numbers to file fake tax returns and steal hard-working American’s refunds. Filing early cuts the chance that you could be a victim of tax refund fraud, though it does not eliminate the threat.