While your taxes and tax return aren’t technically due until the mid-April deadline every year, you can file them months early if you so choose. Waiting until the last minute will likely only make the experience significantly more stressful for you, so it makes sense to get it taken care of early on so you don’t have to worry about it later.
Now that we’re in the thick of tax preparation season in Hayward, CA, here are just a few of the biggest reasons why you might consider preparing and filing your tax return a little earlier than usual this year.
Get your refund sooner
One of the biggest reasons why people like to file their tax returns early is so they can get their refund earlier in the year. The best way to get a fast refund is to e-file and choose direct deposit as your delivery option—paper refunds take significantly longer to process, so e-filing (which is now performed by more than 92 percent of American taxpayers) is the best way to go.
There are plenty of reasons why getting an early refund can be beneficial. It can represent more money to pay off important bills or put into savings. It could be an early down payment on a new vehicle, or money you’ll use for a vacation. Simply put, if you know you’ve got money coming, why not try to get your hands on it as soon as you can?
Give yourself more time to pay
If you know (or suspect) you’re going to owe money to the IRS for your taxes, filing your return early in the year gives you a little more time to plan out how you’ll make that payment. Even if you submit your return in January or February, you still have until that mid-April deadline to pay off any tax liability you owe. This extra time can be helpful if you’re going to need to shift around your budget to be able to make the payment.
Avoid having to file an extension
The majority of people who file for extensions with the IRS do so not because they’re in great financial need, but because they didn’t get organized early enough with their tax documentation. You shouldn’t need to take extra time to find deductions or gather receipts—that should be something you should take care of as soon as possible in the early part of the year. Plus, if you file an extension but don’t pay off your owed tax debt, the IRS will charge you penalties and interest on that outstanding debt until it’s paid off, which is certainly something you’ll want to avoid.
Avoid identity theft
One of the most common identity theft scams is for people to steal Social Security numbers and use them to file fraudulent tax returns to get back money from the government. This scam tends to occur early in the tax season, so by filing early you can guard against it.
For more information about why you should do your tax preparation in Hayward, CA early this year, contact the team of tax prep specialists at Menjivar & Company CPAs, Inc. today.
Categorised in: Tax Preparation