Many taxpayers file tax returns on April 15, but people do not have to wait for this date to submit theirs. In fact, there are various benefits to accomplishing tax returns early.
First off, one will have enough time to prepare and gather the necessary documents in claiming all deductions. After all, last-minute hassle over receipts is something to avoid.
As a tax preparer, you can assist your client in staying away from possible tax issues, eventually satisfying them with your service. In this article, you will learn about the other top reasons why filing tax returns early is beneficial for you and your client.
Amended Return Prevention
Filing early in the tax season will help you make more accurate tax returns on behalf of your client. Keep in mind that faulty returns are likely to be amended returns and result in nasty audits.
Faster Refunds
Filing early will no doubt give you faster refunds. It will also help you avoid rushing and making mistakes that can eventually lead to a stressful audit and an unsatisfied client. Efficient tax planning will give you ample time to estimate capital gains, examine tax losses, and other processes relevant to your tax preparation.
Procrastinating and putting off this task will prevent you from achieving peace of mind until you have checked this responsibility off your list. Filing sooner can almost always guarantee a quick refund since the IRS is not as busy early in the season, unlike in the middle of April.
Finally, filing tax returns early can get your client’s money in their hands as soon as possible. It will help them pay their bills and expenses right away and avoid taking out expensive loans.
Identity Theft Prevention
Naturally, filing early will lessen the chances of someone else stealing your client’s identity and claiming refunds in their name. Solving issues like this can take months or even years.
Simply put, filing ahead of the deadline makes an individual less vulnerable to identity theft and other costs to fix the problem.
New Standard Deduction
In filing tax returns, you need to choose between itemizing deductions and considering the new and relatively higher standard deduction set forth in 2018. Early preparation of tax returns will help you immediately decide on the most suitable method for your client.
No Penalties
Preparing and filing tax returns early provides you the time you need to understand any changes to the tax law. It can also aid with addressing lifestyle and schedule changes that may conflict with your client’s filing status.
As already mentioned above, working on tax returns at the last minute can make you more prone to mistakes that inevitably lead to audits and penalties that your client won’t like.
Ensuring a Successful Early Filing
- Always be honest. If no return needs to be amended, do not resort to correcting it to make things work to your advantage.
- Early filing can make you miss late-arriving forms. Remember to prepare all necessary documents and statements before clicking “Send” or dropping your tax returns in the mail.
- Even banks and financial institutions can make mistakes, so you must catch these mistakes before filing tax returns. Check pertinent documents, such as 1099s, interest statements, W-2s, and others.
Conclusion
Follow our tips above, and you will definitely reap the benefits of filing tax returns early.
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