The U.S. government extended the tax filing deadline to July 15 to help those facing economic distress from the COVID-19 pandemic. There are many advantages to filing early that you should take advantage of if you’re financially stable. It’s integral to tax planning and may yield much-needed money while you wait for the economy to recover.

Why You Should File Your Taxes Before July 15

1. Get Your Return Sooner

The result of all your tax planning is a well-earned return. Families often use this money to purchase new cars, make a down payment on a home, and eliminate debt.

The longer you wait to file your taxes, the longer you’ll wait on a return, so do it now. A tax advisor can assist with e-filing and review to ensure you share everything needed with the IRS to get your return as soon as possible.

2. Maximize Economic Impact Payment

The U.S. government is issuing Economic Impact Payments to help Americans through the COVID-19 economic downturn, and the amount is based on your previous income. If you haven’t filed your 2019 taxes, they’ll base the assessment on your 2018 taxes.

If you made over $75,000, you’ll receive less than the standard $1,200; if you made over $99,000, you’ll receive no payment. Those who made less money in 2019 than 2018 must file their taxes to update the IRS and maximize their payment.

3. Gain More Time for Audit Recovery

If the IRS discovers an error in your taxes, you’ll be audited. They’ll request that you deliver documents to resolve the error or provide proof that it’s incorrect. This process will delay your return.

While it’s not certain that you’ll be audited, by filing early, you give yourself time to address the error, so you can receive your return as soon as possible. If you wait until July 15 and are still audited, you may not see your return until the end of the year.

If you’re looking for tax planning assistance in Kailua-Kona, contact Daren Katayama, CPA. This company maintains an A+ rating from the Better Business Bureau® and serves individual and business clients. Whether you’re searching for a financial advisor or need tax return services, they’ll provide all the assistance you need. Call (808) 329-6635 to schedule a consultation, and explore their full scope of work on their website.