This year, Tax Day is on Monday, April 18. That means your federal returns don’t have to be filed or postmarked until that date. However, this year, if you’re expecting a return, it might benefit you to file your tax return early.
General Benefits to Filing Your Tax Return Early
Completing your tax return early can protect you against fraud. How? When someone fraudulently files a tax return using your Social Security number, they can get their hands on the refund that is owed to you. And then when you go to file, the IRS flags that a return has already been filed under your SSN. By filing early, you have a better chance of beating the scammers to the punch so they can’t use your SSN.
By working on your tax return well in advance of the deadline, you have more time to work on the forms and because you aren’t rushed, you are at less risk of making a mistake. It’s much easier to take your time and not worry about a pressing deadline.
Along the same lines, if you plan to go to a tax preparer, they’re much busier the closer it gets to the filing deadline, so you’ll have an easier time working with a tax preparer if you start early.
Filing early also gets your refund in your hand sooner. That’s always a great bonus.
What if You Owe Money?
If you owe money, you absolutely should file early. Why? Just because you file your tax return doesn’t mean that you have to pay your tax bill that same date. The bill just needs to be paid by the deadline. You can defer that payment until April 18 even if you file on February 1. That gives you that much more time, should you need the extra time to figure out how to pay the bill. Additionally, you can simply choose to complete your tax return paperwork and then wait to submit, but then you run the risk of forgetting to file.
Special Situations for 2022
The IRS is still dealing with delays from due to the pandemic, plus they’re dealing with incredibly heavy call volume. Additionally, they’re still dealing with returns from last year that had errors and needed to be corrected. If your return is error free, you’re unlikely to have an issue, but if your return has an error or you need assistance from the IRS, your refund could be significantly delayed due to these issues at the IRS. It’s definitely worth working on your return early, double and triple checking it, and filing your tax return early.
Read More:
- Do You Have to Pay Taxes for a Nanny?
- Taxes When You and Your Spouse Lived in Different States
- How to Prepare Taxes: 10 Tips for Preparing Your Taxes
Megan is a 40-something government employee in the Washington, DC area. She got interested in Personal Finance when she got out of college and realized that her paycheck wasn’t going to go as far as she had hoped. Since starting this blog, she has managed to buy a house and make a solid start on her retirement goals, and hopes to help others do the same. Here is her story:
In 2007, I was a gainfully employed 20-something with no debt but not a lot of knowledge about personal finance. It was a co-worker’s comment about Roth IRAs that sent me to the internet, searching for information. It was then that I realized that I really didn’t know a whole lot about personal finance and that my current financial situation was due a lot to inherent frugal tendencies, generous family members, a fear of debt, and good luck. While that was working for me, clearly I needed a better plan.
While I had no debt, I was also pretty much living paycheck to paycheck and not worrying about going over budget (I say this as if I had a real budget) because I had an emergency fund set aside to cover any overages.
Except that’s not what an emergency fund is for.
So I did a lot of research, read a lot of blogs, and decided that I needed a plan. I needed to budget. I needed to know what I was spending my money on. I needed to prepare for the future.
I decided to create a blog not only to make myself accountable to others but also to share the knowledge that I gained along the way. I’ve learned so much from my fellow bloggers, and I hope that my readers can find something useful in what I have to share as well.
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