When is the Best Time to File My Tax Return?
Here at Phoenix Tax Consultants, we believe that the earlier you file your taxes, the better. However, do certain situations ever warrant waiting to file your taxes? In this article, we’ll explain the best time to file your tax return depending on your situation, and if it’s ever a good idea to wait. With these tips, and tax consulting help from our team, you’ll get your taxes filed quickly, accurately, and on time!
Get your refund as soon as possible
If you know you’ll be getting a refund, the best time to file is as soon as you have all of the paperwork you need to file. Just avoid filing a paper return if you want your refund sooner rather than later. Paper returns can take up to eight weeks to process, so you’ll have to wait up to two months before you can get your refund. However, electronically filed returns typically get processed in as little as 21 days!
If you’re really interested in speeding up the process, we recommend choosing direct deposit as well. Otherwise, even though your return was processed quickly, you’ll be waiting for your refund check to make its way to your mailbox.
Your tax situation is uncomplicated
Although taxes are never really simple, some people have less complicated situations than others. If this is the case for you, there’s no reason for you to wait to file once you have all the necessary documents. You won’t have a larger refund or a change in your return simply because you wait to file, so why procrastinate?
Even if you know you’ll owe money, you should file as soon as you can. Filing before the deadline doesn’t mean that you have to pay before the deadline. Filing early will let you know how much you need to pay so you can prepare to pay by the deadline instead of being surprised by how much you owe just a week before Tax Day because you waited to file.
Prevent identity theft
As we mentioned in our previous blog, identity theft is an unfortunately common issue for taxpayers who will be getting refunds. If you want to do your best to stop a thief from claiming your refund before you can, file as soon as you can. Thieves usually file returns in late January because most people don’t file until long after that. Of course, you can’t file without all the proper documentation, but once you have everything, don’t wait! Once you’ve filed your return, any other returns filed in your name will be rejected by the IRS, successfully preventing attempts at theft.
Avoid late penalties
If your tax return doesn’t get to the IRS until after the April deadline, you’ll get a late-filing penalty that could be as much as 5% of your taxes due for every month or partial month that your return was late, with a maximum of 25%. If for some reason you won’t make the deadline, make sure to plan ahead and request an extension before the deadline.
Something important to remember is that a filing extension does not mean that you’ll get an extension for paying what you owe. Even with an extension, you may owe interest in addition to a late payment penalty. Late payment penalties are usually 0.5% of the amount owed for each month the payment is late up to a maximum of 25%.
Filing early will avoid any penalties while allowing you to take time to plan and budget for any taxes you owe.
You don’t have all your documents
Something we’ve mentioned in each of these sections is that you should file as soon as you have all the necessary documents. In addition to this, you need to verify that all the information included in these documents is accurate.
Most of the time, the documents you receive will be accurate, but mistakes aren’t unheard of, so it’s important to check your documents once you receive them. If a mistake is made and you are sent updated paperwork after you’ve filed your tax return, you’ll have to file an amendment, which can prolong processing time.
Although earlier is better once you’ve gotten all of your documents, it’s important to postpone filing if you find a mistake or are waiting on a document.
Your tax return will be complicated
Waiting to file your tax return may be a good idea if your tax situation is complex. However, you may still want to being the process of filing early, just take some time to review your return before filing. Taking this extra time to review your return will allow you to make necessary adjustments or fix mistakes to avoid filing an amendment. Sometimes taking extra time to correctly prepare your return is the best plan of action.
Need help with taxes? Get tax consulting from Phoenix Tax Consultants!
As you can see, there aren’t very many situations in which waiting to file your taxes is a good idea. In most cases, you’ll get the most benefit from filing as early as you can. However, if you need help filing your taxes on time, get tax consulting help right here at Phoenix Tax Consultants.
When you let us handle your taxes, you can be sure that your tax preparation will be completed quickly and accurately. We also pride ourselves on our customer service, which is why we do our best to provide prompt replies to your questions, value-added planning, tax-saving recommendations, and more. We also offer virtual and in-person filing options, so filing your taxes is always convenient and easy for you.
With more than 30 years of local tax preparation, tax planning, and audit experience, why would you trust anyone else with your tax needs? Schedule an appointment today!