It’s no secret that taxes can be complicated, which is probably why a lot of people file their taxes as close to the deadline as possible. After all, many would prefer to take their time to make sure all the numbers check out. However, there are a number of good reasons to get in touch with a Nashville accounting firm and file your taxes earlier than the April 15 deadline. Some of them are below.
You receive your tax refunds earlier
Did you know that the IRS had a backlog of 12.4 million returns as of September 2022? As a result, millions of Americans encountered significant delays in their tax refunds. While filing early will not guarantee that you can avoid a delay altogether, it certainly assures you that you will get your refund earlier than someone who files closer to the deadline.
Extra tip: if you want to expedite your refund, consider e-filing your returns as early as mid-January.
You get a headstart on large, planned expenses
Interested in buying a house in 2023? Is your child going to head off to college? A number of large expenses require financial information that can be found on tax returns. For example, homebuyers often need to show a completed tax return as proof of household income. Given this, it’s generally a good idea to file your taxes early so you can have a headstart on the necessary paperwork associated with big life changes.
You protect yourself from identity theft
Have you ever heard of tax return fraud? It’s a type of scam where identity thieves use your Social Security number to file a fraudulent tax return so they can pocket your tax refund. According to experts, fraudsters typically take advantage of the early tax season since their activities wouldn’t be detected until much later. Aside from keeping your Social Security number secure, filing early minimizes the chances that a fraudster can file a fake return before you do.
You buy extra time to pay what you owe
After submitting your tax return, you will not be required to pay any taxes you still owe until the April 15 deadline. If you file your Form 1040 early, you determine in advance the exact amount that you need to pay and still have several weeks to set aside that amount properly. Needless to say, this can be particularly useful for those who had to deal with unexpected expenses from the previous year.
You can find an accounting firm more easily
The closer you get to the deadline, the harder it can be to find an accounting firm that will take you on as a client. Tax season, after all, is an incredibly busy time for accountants. As such, you’d be well advised to partner with a respected accounting firm like Evan Hutcheson, CPA, LLC as soon as possible to make sure you will get quality assistance with tax preparation.