Each year, taxes are due on April 15 (or the closest non-holiday business day afterward if the 15th happens to fall on a weekend). And this year is no exception.
However, you don’t have to wait until April to file your 2023 tax return. The IRS will begin accepting tax returns as early as Jan. 29 this year. And filing your taxes earlier in the season could benefit you in several ways. That said, you may not want to file your taxes too early for one big reason.
The upside of filing your taxes early
Getting your tax return done well ahead of the filing deadline could benefit you. First, if you’re due a refund, the sooner you send the IRS your return, the sooner your refund might hit your bank account.
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Filing your taxes early might also help you avoid falling victim to fraud. Mark Steber, Chief Tax Information Officer at Jackson Hewitt Tax Services, says, “Filing as soon as you’re able protects your personal information from being used by someone else.”
If a criminal gets a hold of your Social Security number, they might use it to try to file a tax return in your name and divert your refund to a bank account only they have access to. If you file your tax return first, their fraudulent return will be flagged as a duplicate by the IRS.
Also, while many people get a tax refund each year, you may be in a position this year where you owe the IRS some money. The sooner you get your taxes done, the sooner you can devise a game plan to pay whatever balance you owe.
Finally, Steber says that filing early might just plain reduce your stress. “If you file your tax return early and not wait until the deadline, you just don’t have to worry about it.”
You may not want to file too early
Filing your tax return in, say, mid- or late February might be a good idea. But filing at the end of January could backfire on you.
For one thing, companies that issue 1099 forms (forms that summarize different types of income you earn, like interest in a savings account) are required to issue them by Jan. 31. If you file your tax return on Jan. 29, you may file at a time when you haven’t yet received all of your necessary tax forms. That could be a problem, because if your return is missing income that the IRS receives a record of, you’re more likely to get audited.
Also, it’s not unheard of for companies to issue 1099 forms by Jan. 31 and then send out amended 1099s later in the tax season. Granted, this could happen at any time, but waiting a few weeks to file your taxes gives those companies time to sort out the right information and issue amendments as needed. If you file your taxes and then receive an amended 1099, you might, in turn, have to file an amended return, which could be a hassle.
All told, filing your taxes well ahead of the April 15 deadline could work to your benefit this year. But you may not want to be that person who files a tax return on the very first day of the season.
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