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Research-based financial information to help you develop and maintain thoughtful and effective financial behaviors
Camaya Wallace Bechard
Extension Educator, Consumer Economics
University of Illinois Extension
1615 Commerce Parkway
Bloomington, IL 61704
Tax Time! File early for best results.
It’s tax time!
You’d rather do anything but think about filing your income taxes which aren’t due until April 15, 2018, but I am urging you to start preparing now and file as early as humanly possible.
There are lots of reasons to begin your income taxes now that could save you money. Making additional contributions to your IRA’s before April 15th is tax deductible. You won’t know if you need to or are able to until you put some rough numbers together.
However, the biggest reason may be to make sure you get your refund before con artists file on your behalf and steal your identity and your money.
According to a study by the Government Accountability Office, the IRS stopped $24.2 billion of fraud in 2013 but failed to prevent another $5.8 billion that went to criminals, with some uncertainty over how much more went undetected. There was even more fraud last year.
No one seems immune from this sort of theft. I was at a conference with officials from one of the big three credit reporting bureaus and one told that he had just found out that he’d “already filed and received a refund of over $9,000!” These thieves are in this for big bucks.
Note the IRS won’t even begin accepting returns until sometime in mid to late January 2016 and you don’t even have the 1099’s and W-2’s to be able to file, but there is plenty you can do now to get ready to hit send as soon as possible.
7 things you can do NOW to prepare for income tax time
1. Start pulling together your documents detailing income and deductions and adding up receipts early.
2. Use the last paystubs of the year to estimate you income and taxes paid.
3. Consider getting a locking mailbox. Most identity thieves still get their information the old fashioned way- through garbage, recycling bins and mailboxes.
4. Consider purchasing tax software. If you file yourself you probably already have a favorite brand. Even if you have a tax preparer- using the software to collect and sort your information will make it easier for them to files fast and early.I have been entering in my tax information into the software as it comes in the mail or I get electronic notification. It only takes a few minutes and will save me that lost Saturday doing it all at once!
5. Make an early appointment with your tax preparer.
6. Monitor incoming tax related documents like investment statements and W-2’s and report those that are slow in coming.
7. File as early as possible.
All income tax thieves need is your name and social security number to create a phony W-2. Then they file a return on your behalf and have the refund deposited in their accounts. If that happens and you try to file later- your return will most likely be rejected and then the “fun” begins.
The IRS has steps in place for you to begin the task of finding out about the fraudulent filed in your name. For more Information check out IRS publication Instructions for Requesting Copy of Fraudulent Returns. For more information on how the IRS is working to protect you from fraud click here.
You don’t need to spend marathon sessions at these tasks, a little time here and there can go a long way towards being prepared.
Here’s hoping you have a prosperous New Year!
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