As the tax deadline 2025 approaches, many taxpayers fall into the trap of procrastination. At 7B Bookkeeping & Tax LLC, we’ve seen firsthand the benefits of early filing and the pitfalls of waiting until the last minute.
Filing your taxes well before April isn’t just about beating the rush-it’s a smart financial move that can save you time, money, and stress. In this post, we’ll explore why early filing is advantageous and how you can overcome common obstacles to get your taxes done sooner.
Why File Early? The Benefits Explained
Filing your taxes early offers several advantages that can significantly impact your financial well-being. Early filers often experience smoother tax seasons and greater peace of mind.
Faster Access to Your Refund
One of the most compelling reasons to file early is the potential to receive your refund sooner. Within 24 to 48 hours after e-filing your tax return, you’ll usually receive confirmation from the IRS. This quick processing time means you could have your refund much earlier, allowing you to put that money to work for you sooner. This can be particularly beneficial if you plan to use your refund for debt repayment, investments, or major purchases.
Time to Address Unexpected Issues
Early filing provides a buffer to deal with any surprises that may arise during the tax preparation process. For instance, if you discover you’re missing important documents or need to gather additional information, you’ll have ample time to do so without the pressure of an impending deadline. This extra time can prove essential in ensuring accuracy and completeness in your tax return.
Protection Against Identity Theft
Filing early is an effective strategy to protect yourself against tax-related identity theft. Tax-related identity theft is a growing concern, with criminals using stolen taxpayer data to commit fraud. When you submit your legitimate return early, you reduce the window of opportunity for potential fraudsters. The IRS can only accept one return per Social Security number, so your early filing acts as a safeguard against fraudulent claims.
Avoiding Last-Minute Stress and Errors
Rushing to meet the April deadline can lead to mistakes and oversights. A study by the Chamber of Commerce found that nearly one-third of Americans wait until the last minute to file their taxes (increasing their risk of errors). Early filing allows for a more thorough review of your tax situation, potentially uncovering additional deductions or credits you might miss in a hurried filing.
Early filing positions you for a more favorable tax experience. You not only gain financial benefits but also reduce stress and potential complications. The next section will explore common reasons why people delay filing their taxes and how to overcome these obstacles.
Why Do People Procrastinate on Taxes?
Many taxpayers postpone their tax preparation until the last minute, despite the clear advantages of early filing. This procrastination often stems from a combination of factors that make the task seem daunting or unpleasant. Understanding these common reasons can help you overcome them and take a more proactive approach to your taxes.
The Challenge of Disorganized Records
One of the primary reasons people delay filing their taxes is the lack of organized financial records. Throughout the year, receipts, income statements, and other important documents can pile up or get misplaced. When tax season arrives, the prospect of sorting through this disorganized mess can overwhelm many taxpayers.
A survey by the National Association of Tax Professionals found that 28% of taxpayers cite disorganization as their main reason for delaying tax preparation. This disorganization not only makes the process more time-consuming but also increases the risk of errors or missed deductions.
To combat this issue, you should implement a year-round system for organizing financial documents. Set up digital folders for scanned receipts and statements, or use a physical filing system with clearly labeled categories. This ongoing organization will significantly reduce the time and stress involved in preparing your taxes.
The Fear Factor: Owing Money to the IRS
Another significant reason for tax procrastination is the fear of owing money to the IRS. Many taxpayers worry that they haven’t set aside enough funds to cover their tax liability, leading them to avoid the issue altogether.
According to a study by NerdWallet, 27% of Americans who file taxes say they’re afraid of owing money to the IRS. This fear can be particularly acute for self-employed individuals or those with multiple income sources, who may not have had taxes automatically withheld throughout the year.
To address this concern, you should consider making estimated tax payments throughout the year if you’re self-employed or have significant non-wage income. This approach can help spread out your tax liability and reduce the shock of a large bill in April. Additionally, working with a tax professional can provide a clearer picture of your potential tax liability well before the filing deadline, allowing you to plan accordingly.
The Stress and Complexity of Tax Preparation
The perceived complexity of the tax code and the stress associated with filing can also lead to procrastination. Many taxpayers feel overwhelmed by the forms, calculations, and ever-changing tax laws.
A recent study revealed that residents in some states, such as Hawaii, experience higher levels of tax-related stress due to high income tax rates. This complexity can be particularly daunting for those who have experienced significant life changes (such as getting married, buying a home, or starting a business).
To alleviate this stress, you should consider using tax preparation software or working with a professional tax preparer. These resources can guide you through the process, ensure accuracy, and help you identify all applicable deductions and credits.
Now that we’ve identified the common reasons for tax procrastination, let’s explore effective strategies to overcome these obstacles and prepare your taxes in a timely manner.
How to Prepare Your Taxes on Time
Filing a tax return early can make sense for various reasons, such as getting your refund sooner or minimizing the risk of identity theft. Here are practical strategies to ensure you file well before the deadline.
Create a Year-Round Financial Organization System
Implement a consistent system for organizing your financial documents throughout the year. Set up a dedicated folder on your computer or cloud storage for each tax year. Create subfolders for different types of documents such as income statements, receipts for deductions, and investment records.
For physical documents, use a filing cabinet with clearly labeled folders. When you receive important tax documents, scan and save them to your digital system immediately, then file the physical copies. This dual approach ensures you have backups and easy access when it’s time to prepare your taxes.
Leverage Technology for Efficient Record-Keeping
Use financial apps and software to streamline your record-keeping process. Many banks and credit card companies offer features that automatically categorize your expenses, which makes it easier to identify potential deductions. Apps like Expensify or Shoeboxed help you digitize and organize receipts on the go.
For business owners, accounting software like QuickBooks Online can transform your tax preparation process. It not only helps with day-to-day bookkeeping but also generates reports that prove invaluable during tax season. (7B Bookkeeping & Tax LLC offers QuickBooks setup and training to ensure you maximize the software’s potential for your tax preparation needs.)
Set Personal Tax Preparation Milestones
Don’t wait for the official tax deadline to start thinking about your taxes. Set personal milestones throughout the year to keep yourself on track. For example:
- January: Gather all W-2s, 1099s, and other income statements as they arrive.
- February: Collect and organize receipts for deductible expenses.
- March: Schedule an appointment with a tax professional or block out time to use tax preparation software.
Breaking down the tax preparation process into smaller, manageable tasks helps you avoid the overwhelming feeling that often leads to procrastination.
Consider Professional Tax Preparation Services
While DIY tax preparation software has improved over the years, the expertise of a professional tax preparer proves invaluable, especially if you have a complex financial situation. Hiring a tax professional can provide not only time savings and reduced stress but financial benefits as well.
Professional tax preparers (such as those at 7B Bookkeeping & Tax LLC) provide expert guidance, ensuring you don’t miss out on potential deductions and credits. Many offer secure, remote tax preparation services, which makes it convenient for you to get your taxes done early without leaving your home or office.
Final Thoughts
Filing your taxes early offers numerous advantages that impact your financial well-being and peace of mind. You gain quicker access to potential refunds, more time to address unexpected issues, and enhanced protection against identity theft. Early filing reduces stress and potential errors associated with last-minute submissions.
Implementing year-round financial organization systems and leveraging technology for efficient record-keeping help overcome common obstacles. You can approach the tax deadline 2025 with confidence by breaking down the tax preparation process into manageable tasks throughout the year. Professional tax preparation services provide invaluable assistance for those seeking expert guidance and support.
At 7B Bookkeeping & Tax LLC, we offer comprehensive financial services, including expert tax preparation, bookkeeping, and financial consulting. Our team of professionals (including a Chartered Tax Professional and Enrolled Agent) ensures secure, remote tax preparation and reliable IRS representation. We strive to help you maximize savings, minimize liabilities, and navigate the complexities of tax season with ease.