We have heard data breach on the news. The most major one recently is the Equifax data breach which affects millions of tax payers’ sensitive information like their social security number. Identity theft is also on the rise. You can minimize the impact of these of these data breach and identify theft on your tax return if you are the victim.
The bad guys will not be able to compromise your tax return if you beat them by e-filing your tax return earlier than them. IRS electronic system will then reject any e-filing of your tax return filed by the bad guys. This is because IRS system already has the one you filed. Here are some other benefits and facts about e-filing your tax return as early as possible.
The benefit of e-filing early normally benefits a separated couple or couple who are in the process of getting divorced. The custodial parent normally has to go through the trouble of getting his or her refund delayed, paper filed his or her return, and the emotional distress that comes with it. This is because the non-custodial parent who isn’t supposed to claim the children as dependent did claim the children and e-file it earlier than custodial parent.
Another example who often happens is a parent who claims their adult child. And the adult child isn’t a full time student and no longer under 19 years old. And the parent didn’t provide more than half the support of the adult child in the tax year the tax return is e-filed for. This adult child often will have to go through the same process above as the custodial parent to file his or her tax return.
There is a “myth” that says you have to pay IRS the amount you owe on the tax return by the time you file your tax return. The due date of the amount you owe on your tax return is still due on the last day to file your tax return, regardless of when you file or e-file your tax return. The last day to file is on April 17, 2018 this year. IRS also doesn’t pay you interest in holding your tax refund. Your tax refund can earn interest or other benefits when you file early to claim it.
So have you filed your tax return yet? We are in the opinion that you should file early whenever you are already ready to file.