The new tax reform law recently passed by Congress and signed into law by President Trump will affect this year's taxes, but in the meantime people have to file last year's. January 29 is the first day the IRS will begin accepting e-filed 2017 tax returns, with this year's filing deadline April 18.
Most Americans procrastinate when it comes to filing their taxes, but there are good reasons to get them done early, starting with identity fraud. "The IRS is expecting this year a higher number of fraud identity theft, as it relates to tax returns," says Lydia Desnoyers, CPA and tax specialist. An increasingly common scam involves people stealing taxpayer identities, then filing fraudulent returns in order to claim refunds. This causes major problems and delays when the actual taxpayer goes to file their return. Thus, filing early reduces the chance of someone else having an opportunity to file a phony return in your name.
Desnoyers also recommends filing earlier in order to allow more time to correct errors or omissions that may occur, without causing a substantial delay in your return. The biggest tax-filing issue she sees is people not having all of their proper documents or forms ready before going to file. "Having all of your documentation...for businesses, tracking all of your receipts and expenses, and having them in an organized fashion," says Desnoyers. Another common issue is people forgetting about secondary sources of income. "If someone switches jobs early in the year, they may forget that first W-2," says Desnoyers.
The bottom line for tax-filing, according to Desnoyers, is to have all of your ducks in a row beforehand. "Even if you're not sure if you'll need it or if I'll use it, I prefer we have more information and more documents that you go home with that we didn't use, rather than us missing information and having to delay the process of filing your return," she says.