Are There Benefits of Filing Taxes Early? And What Happens if I File After the Deadline?
Tax season is a stressful time of year, even for those with the most straightforward of returns, and that stress is amplified even further as the April 15th deadline looms closer. One of the best ways to alleviate those feelings of dread is to start planning well in advance of mid-April, and if possible, file early. In addition to sleeping better at night, there are a number of other potential benefits to beating the deadline, but what happens if you miss it altogether and file late?
Time Is On Your Side
There are a number of dates worth noting, for those wishing to get a jump on their taxes, beginning with January 23. In 2017, this is the first date when electronic tax returns may be submitted and paper returns begin processing, though this date varies from year to year. Those who routinely submit their returns before the deadline or prepare returns for a living, know the advantages of filing taxes early, including:
- Faster refunds. While there’s no steadfast guarantee, those who file first are typically first to receive any monies owed them.
- Financial aid. For those with college aged children, hoping to benefit from the Free Application for Federal Student Aid, an early return is essential. Thanks to the direct link between this program and the IRS, filing ahead of schedule can help maximize financial aid for those who qualify.
- Less errors. Give yourself more time to find lost receipts and other documentation, seek professional assistance, and double-check your return for errors prior to submitting.
- Theft protection. Identity theft is rampant at tax time with thieves filing false returns with stolen information. The sooner you file, the more you increase your odds of beating them to the punch.
Better Late Than Never?
Even with 365 days advanced warning, many individuals and businesses still manage to miss the April deadline. Here are some important details worth noting, about filing late:
- Make up for lost time. File as soon as you can to minimize the amount in interest and penalties that you will owe.
- Request an extension. This form has the same mid-April deadline, but while it may buy you more time, it won’t get you out of paying any penalties. However, you may be able to circumvent this additional cost if you pay at least 90 percent of what you owe at the time you file your extension.
- Get in line. If you’re lucky enough to be getting a refund, filing late won’t incur any fines, but you will have to wait longer for your refund check as this will put you in line behind all those who filed on time.
Once your taxes are filed, regardless of whether or not you just made, beat, or passed the deadline, you’ll likely be left with a mountain of paper. Knowing what to keep and what to shred is crucial in the event of a an audit, regulatory, or government compliance. When in doubt it’s better to hold on to items until a later date, but as a rule of thumb keep all supporting documents for three years from the date you filed, unless you fall under any of these categories identified by the IRS.
Once the deadline for supporting documentation has passed, call TrueShred, for secure, onsite destruction of personal and business documents, and for all your other shredding needs. Our secure chain of custody and onsite process meets all regulatory standards of compliance, and a Certificate of Destruction will be issued upon completion, for your records.
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