As tax season approaches, the perennial question arises: Should you file your taxes early or wait until the last minute? While some may prefer to procrastinate, there are compelling reasons why being an early bird when it comes to filing taxes can offer distinct advantages. In this article, we'll explore the benefits and reasons to consider filing your taxes ahead of the deadline.
Prompt Refunds: One of the most significant advantages of filing taxes early is the potential for a quicker refund. If you're entitled to a tax refund, filing early means you'll receive your money sooner. This can be especially beneficial for individuals who rely on their tax refunds to cover essential expenses or financial goals.
Avoiding Last-Minute Rush: Filing taxes early helps you steer clear of the last-minute rush. Waiting until the deadline approaches can lead to stress, mistakes, and delays. By taking a proactive approach, you reduce the risk of encountering technical glitches on tax filing platforms and ensure that your return is processed smoothly.
Identity Theft Prevention: Early filers are less susceptible to tax-related identity theft. By submitting your tax return promptly, you reduce the window of opportunity for potential identity thieves to file a fraudulent return using your personal information.
Peace of Mind: Completing your taxes early provides peace of mind. You can rest easy knowing that your financial affairs are in order, and you've fulfilled your tax obligations. This mental clarity allows you to focus on other aspects of your life without the looming deadline hanging over you.
Opportunity to Address Issues: Filing early gives you ample time to address any issues that may arise during the filing process. If you discover missing documents or encounter complexities in your financial situation, you have the time to gather necessary information or seek professional assistance without the pressure of an impending deadline.
Financial Planning: Early filing contributes to better financial planning. Knowing your tax liability or refund early in the year enables you to plan for any tax payments or allocate your refund towards financial goals such as debt repayment, savings, or investments.
Access to Tax Professionals: Tax professionals and accountants often experience increased demand as the tax deadline approaches. Filing early allows you to secure the services of tax professionals more easily, ensuring that you receive expert guidance if needed.
IRS / Government Shutdowns: There is a potential in every year but even more in 2023 of a government shutdown. Government shutdowns have many effects but one of the most annoying is that the IRS also goes into a very reduced capacity function. This can delay refunds, communications, processing returns, etc.
Filing taxes early isn't just about meeting a deadline—it's a strategic financial move with tangible benefits. From prompt refunds to identity theft prevention and peace of mind, the advantages of being an early bird in the tax season are clear. Consider taking a proactive approach this tax season to reap the rewards of early filing and set the stage for a financially organized year ahead.