Dave Ramsey: 6 Benefits of Filing Your Taxes Early

It’s tempting to put off filing your taxes until the last minute. Tax time often comes with a lot of stress, so there’s often a tendency to avoid this task for as long as possible. However, there are advantages to getting a head start.

Dave Ramsey outlines compelling reasons to get ahead of the game and file your taxes early. Here are six benefits of filing early.

The IRS has faced significant backlogs, with millions of unprocessed paper tax returns in recent years. In his column, Ramsey says filing early, especially electronically, and choosing direct deposit can help you avoid these delays. Making sure your tax forms are accurate can also prevent unnecessary hold-ups.

Tax season is stressful, with many taxpayers feeling the pressure. Setting a personal deadline well before the deadline allows you to complete your taxes without the last-minute rush. This will help reduce stress and allow for a more thoughtful approach to your finances.

IRS data indicates that early filers often receive larger refunds. This is likely because starting earlier gives you more time to accurately claim all eligible tax deductions and credits, maximizing your refund. A large refund means you’ve essentially given the government an interest-free loan. Your best bet is to consider adjusting your withholdings to optimize your take-home pay throughout the year.

Filing early can also reduce your chances of becoming an identity theft victim. If a thief files a tax return in your name before you do, it can complicate your filing process and delay your refund. Filing early minimizes this risk and secures your refund.

If you owe money to the IRS, filing early gives you time to prepare. Knowing how much you owe well in advance allows you to budget accordingly. This will help reduce financial strain or the need to dip into emergency savings.

Tax professionals get booked quickly as the filing deadline approaches. By organizing your tax filing early, you’re more likely to secure time with a tax advisor who can help navigate complex tax situations and make sure you’re taking advantage of all possible tax benefits.