There was a recent announcement by the IRS that due to the last government shutdown a few months ago, the IRS may need a bit of extra time to get ready before starting up this year. The IRS needs the extra time to check tax forms, form instructions, run checks and diagnostics on computers and software, and basically ensure all tax administration systems are up and running as needed before tax returns will be processed -- time that was lost during the government shutdown. Accordingly in the coming days, the IRS will formally announce the start of tax season, and it may be a bit later than originally scheduled.
In reality, this IRS start date has very little impact on a taxpayer's ability to get started on his or her tax return: getting organized, preparing and even filing an annual tax return -- Form 1040, U.S. Individual Income Tax Return. It is always a best practice to get started on your taxes as soon as possible. The IRS is only considering a delay of one to two weeks from the original projected start date for IRS processing of 2013 tax returns. The window for IRS accepting and processing tax returns ranges from January 28, 2014 to as late as February 4, 2014. Those dates are when the IRS will actually process an individual tax return. You can start your data collection, and subsequently your tax return preparation, as soon as you have your current year information, including your W-2 and any other forms or records you may need.
So why is it a best practice to file earlier rather than later?
- To start with, about 110 million taxpayers got a tax refund last year -- that is about three out of four filers or 75 percent of all taxpayers. A tax refund is a refund of your money -- getting it sooner is always better than getting it later.
- Refund crime and identity theft is a big problem and getting bigger every year. Filing your tax return early can help secure your information. Filing early helps prevent identity theft for you. The IRS will take a longer period of time to process a return from a Social Security number that has been submitted more than once. While filing early helps ensure your tax return is filed and processed, the IRS will notify you if they suspect your Social Security number has been compromised.
- Finally, if you have your taxes prepared and file your tax return early and you find that there is a problem or surprise issue, you will have more time to fix it or find the information needed long before the filing deadline of April 15. Filing early gives you more time to solve problems or manage issues should they arise.
In summary, even if the IRS does start a week or so later this year, it is in your best interest to get started early -- as early as you can. Locate and organize your tax information, including current year tax documents and prior-year tax return for reference, prepare and file that tax return and get that refund so you can enjoy it.