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    I’m a Tax Expert: Why You Should Take Your Time With Filing

    By Andrew Lisa,

    2024-02-08
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    Tax season officially kicked off on Jan. 29 when the IRS began accepting federal returns. It ends on April 15, Tax Day, the deadline for all filings and payments for anyone not granted an extension.

    Read: Trump-Era Tax Cuts Are Expiring — How Changes Will Impact Retirees
    See: Owe Money to the IRS? Most People Don’t Realize They Should Do This One Thing

    While it’s tempting to hustle through your taxes just to get it over with, haste usually makes waste whenever the Treasury Department is involved. So while most people probably want to get it out of the way quickly and just about everyone wants their refund as soon as possible, you should give the process the time it requires and deserves.

    GOBankingRates spoke with a veteran tax professional who outlined the most important reasons not to rush through your returns in 2024.

    Sponsored: Owe the IRS $10K or more? Schedule a FREE consultation to see if you qualify for tax relief.

    You’ll Probably Shortchange the All-Important Preparation Phase

    Johan Garcia is a CPA with a master’s degree in tax and more than 10 years of experience in tax advisory, tax compliance and business advisory. He previously served as the lead tax strategist for a publicly traded Fortune 500 company and is currently the owner and sole author of After Tax Cash and principal of JG CPA & Advisory.

    In his experience, the easiest way to shave hours off the process is to neglect the crucial preparation phase. But that leaves you with “insufficient time for gathering all necessary information on taxable activities,” he said.

    Visit the IRS’ “Get Ready To File Your Taxes” page, which offers a point-by-point guide to the critical but often neglected prefiling prep phase.

    Discover: The 7 Worst Things You Can Do If You Owe the IRS

    Rushing Leads To Unforced Errors

    Blowing off the prep phase and sprinting through your returns opens the door to errors you probably could have avoided by slowing down.

    “Rushing tax filing can lead to mistakes,” Garcia said. “For example, incorrect document reporting.”

    The most common path to incorrect document reporting is to rush through filing, only to have important forms trickle in a few days or weeks later.

    “Taxpayers should invest adequate time throughout the months of January and February to verify their information’s accuracy, compile all pertinent data, and claim every eligible deduction and credit,” Garcia said.

    Mistakes Can Be Costly

    If you file a return containing errors, you can’t go back and fix them. Instead, you’ll have to use form 1040-X to submit an amended return. The process is almost certain to waste more hours than you saved by hurrying the first time around — and in most cases, you’ll lose more than just time.

    “Such oversights can cause inaccurate taxable income reporting, miscalculation of liabilities, receiving notices or penalties from tax agencies, undergoing audits, or missing out on deductions,” Garcia said.

    Rushing can also cost you money if you don’t leave time to research pricing for the many competing software programs or tax professionals you’ll use to file.

    You Might Beat Important Legislation to the Punch

    Rushing always increases the risk of jumping the gun, but current legislative action gives millions of families an extra incentive to hold off on filing before they have to.

    “This month, with the looming bipartisan tax bill, you might miss out on new retrospective eligibilities,” Garcia said.

    He’s not just throwing words around.

    The House approved a $78 billion tax bill on Jan. 31 by a vote of 357 to 70, a level of two-party support that’s almost unheard of in today’s political climate. It expands the child tax credit for 16 million children living in low-income households, or 80% of families that currently earn too little to receive the full credit. It runs through 2025 and includes three tax years, including 2023. If you file before the Senate approves the legislation or the details of the bill change before its final passage, you could lose out on money you deserve or be forced to file an amended return.

    If You Claim the EITC, You’ll Wait for Your Refund Anyway

    The biggest reason to rush is that the IRS issues refunds to early birds first — but if you’re one of the 23 million workers and families who divvy up $57 billion from the earned income tax credit (EITC), there’s no sense in hurrying because your refund will be slow to arrive anyway.

    According to the IRS, those who claim the EITC should expect to receive their refund by Feb. 27 — but only if they file electronically and submit a return with no errors. Otherwise, they’ll wait even longer.

    The same goes for families who claim the additional child tax credit.

    If Procrastination Has You Rushing, It’s Better To Delay

    Right now, America’s many procrastinators are telling themselves that Tax Day is months away and they still have plenty of time. Soon it will be mid-April and they’ll be biting their fingernails and scrambling to search for documents. In those cases, there’s just no need to rush because most taxpayers can kick the can down the road for half a year.

    “They should consider extending their tax filings a week or two in advance of the April 15 deadline to avoid mismanagement,” Garcia said.

    The IRS makes it relatively easy to seek a six-month extension that buys you until Oct. 15 to file your returns — just remember you must pay the IRS any outstanding balance by Tax Day.

    This article originally appeared on GOBankingRates.com : I’m a Tax Expert: Why You Should Take Your Time With Filing

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