When Filing a Tax Return Immediately May Make Sense
The 2017 tax filing season officially begins this week as the IRS starts accepting tax returns. There are many reasons to consider filing your tax return early. Here are some of the most common:
Get your refund. There's no reason to let the government hold your funds interest-free, so file early and get your refund as soon as possible. While new legislation delays receiving refunds for tax returns claiming The Earned Income Credit and the Additional Child Tax Credit until after February 15th, the sooner your tax return is in the queue, the sooner you will receive your refund.
Minimize your tax identity fraud risk. Once you file your tax return the window of opportunity for tax identity thieves closes. Tax identity thieves work early in the tax-filing season because your paycheck's tax withholdings are still in the hands of the IRS. If they can file a tax return before you do, they may be able to steal these withholdings.
Avoid a dependent dispute. One of the most common reasons an e-file is rejected is when you submit a dependent’s Social Security number that has already been used by someone else. If you think there is a chance an ex-spouse may do this, you should file as early as possible.
Deliver your return to someone who needs it. If you are planning to buy a house or anticipate any other transaction that will require proof of income you may wish to file early. This is especially important if you are self-employed. You can then make your filed tax return available to your bank or other financial institution.
Beat the rush. As the tax filing deadline approaches, the ability to get help becomes more difficult. So get your documentation together and schedule a time to get your tax return filed. It can be a relief to have this annual task in the rearview mirror.