Why You Should File Your Taxes Early in 2018
Whether you do them yourself or pay someone else to do them for you, preparing your income taxes is probably not one of your favorite chores. Knowing you have a refund coming can make the whole process somewhat easier, but gathering your paperwork and ensuring the forms are completed correctly can still be both time-consuming and stressful.
A good reason to file your taxes early
Even if there’s no refund to be found at the end of your tax-filing rainbow in 2018, there are still very good reasons to file your income taxes as soon as you can, this and every tax season—to try to avoid tax-refund identity theft.
Tax-refund identity theft is when someone files a tax return using your personal information—like your Social Security number—in an attempt to get a tax refund. The Internal Revenue Service says, in effect, the best defense is a good offense: The best thing to do is file early in the tax season—if you can—to get your refund before identity thieves do.
Your filling early won’t block an identity thief from filing a fraudulent tax return using your information, but in this case, first come, first served. By being first, your return will likely be processed first, and it’ll be the identity thief, not you, who receives the IRS notice that a return has already been filed using your personal information. Learn more here about tax-related identity theft.
Learn more about staying safer this tax season in our infographic below.
Other reasons to file taxes early
Are there other reasons you may want to file early? Yes, but they may not be as compelling as avoiding tax-related identity theft. Still, they’re worth considering:
- The sooner you file, the sooner you’re likely to receive your tax refund, assuming you have one coming. By the way, the IRS says the best and fastest way to get your tax refund is to file your return electronically with IRS e-File and have your refund directly deposited into your financial account.
- Even if you owe taxes, preparing and filing your taxes early will help you determine how much you owe. And guess what? Filing early doesn’t mean you have to pay your taxes when you file. You still have until the usual mid-April deadline. The time between when you prepare your taxes and mid-April may help you figure out how to work that tax payment into your budget. (Good luck!) When you send payment after filing, be sure to complete and include form 1040V payment voucher—a statement you send with your check or money order for any balance due on the “Amount you owe” line of your Form 1040, Form 1040-A, or Form 1040-EZ.
- Some lenders—for mortgages or student financial aid, for example—may want to see a completed tax return as proof of income. If you have such an upcoming item on your calendar, you have one more reason to file early—so you’ll have your completed tax return ready for review as part of the application process.
The IRS says it can take 120 to 180 days (or longer) to resolve tax-related identity theft cases. That’s four to six months—a long wait if you need to put your hands on an expected tax refund. So, if filing early means you could get in the IRS queue before an identity thief who has your Social Security number, that wait is one more reason to do so.
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