Americans are not kidding this tax season.
In just one week, since the start of the tax reporting period on February 12, the IRS has received about 35 million individual tax returns, according to data released by the agency on Thursday.
The rush for returns far outweighs what the agency saw last year, even before the coronavirus pandemic hit and led to an extended filing window. In the week ending January 31, 2020 – the first of the 2019 fiscal season – the IRS received 15.7 million statements, he said.
Even as of February 7, 2020, the end of the second week of the 2019 filing season, the IRS had received nearly 29 million individual tax returns, less than they received in just one week this year.
More of Invest in you:
Smaller companies getting extra help from PPP. What to know before signing up
Black small business owners are being left behind in the pandemic, research reveals
Black leaders offer several important steps to help close the racial wealth gap
There are a few reasons why Americans may be in a hurry to file with you now. First, the IRS postponed the start of the process until February 12, so that it had time to prepare after sending the second round of stimulus payments.
Since the agency did not extend the April 15 filing deadline – and said it does not plan to do so – people have less time to obtain their paperwork and any payments due to the IRS.
Deposit benefits as soon as possible
Archiving as quickly as possible may have other benefits for Americans who have been most affected by the coronavirus pandemic.
People may be rushing to sue in the hope of getting a refund soon, which for many is the biggest unexpected win of the year. The quickest way to get any refunds due is to file your taxes as quickly as possible, said Elaine Maag, principal research associate at Urban-Brookings Tax Policy Center.
“There is no point in waiting,” she said.
Filing an income tax return is also the only way that Americans who did not receive the stimulus checks to which they were eligible or did not receive the correct amount of money received.
If you had a drop in income in 2020 or had a child, you can receive stimulus payments for which you did not qualify based on your 2019 earnings. You can also claim tax credits designed to help middle and lower income Americans, such as credit earned income tax and child tax credit, which can be worth hundreds or thousands of dollars, depending on income and family size.
Registering a return is also one of the best ways to ensure that the IRS has your current bank information and address, which can help you with any future stimulus payments, said Maag.
Early deposit can protect against fraud
Filing as quickly as possible can also help protect you from tax fraud, according to Kelley Long, a certified financial planner, CPA and a member of the American Institute of CPAs.
If someone stole your identity and filed an income tax return in your name to request a refund, you will have trouble sending your real information, she said. Next, it is your responsibility to prove to the IRS that the statement submitted on your behalf is fraudulent and provide the correct information.
There is no benefit to waiting.
Elaine Maag
principal research associate at Urban-Brookings Tax Policy Center.
The agency will investigate, which will delay receiving the money owed.
“You don’t want to worry about that extra step of proving that someone has stolen your identity,” said Long.
Tax returns can be changed if necessary
To be sure, as Congress continues to work on coronavirus relief, there may be additional changes to the tax code that would affect returns in 2020. But experts say this is no reason to delay filling in your tax information, or at least start the process of filling out your declaration, as it is not clear when another package will become law.
On the one hand, if you plan to work with a tax professional to file the lawsuit this year, they are likely to suffer because of the reduced season, so it’s best to get in touch as soon as possible.
“I think it is more prudent this year to put everything in order,” said Anjali Jariwala, CFP, CPA and founder of FIT Advisors in Torrance, California.
If legislation is passed that alters your return, you can always submit an amendment later, she said.
SIGN UP: Money 101 is an 8-week learning course on financial freedom, delivered weekly to your inbox.
CHECK OUT: 3 cash movements helped me save $ 100,000 at age 25, says blogger Break Your Budget via Grow with Acorns + CNBC.
Disclosure: NBCUniversal and Comcast Ventures are investors in Nuts.