The old saying about the early bird getting the worm is often one of the truest adages in business. It seems like every little good ever comes from running late – especially with your taxes. As a small business owner, you know that you have to file on time (and pay on time) or you will be penalized. But is there a benefit if small businesses file taxes early? Often the answer is yes! Let’s explore the benefits of filing business taxes early.
Your Refund Quicker
One of the biggest benefits of filing your small business taxes early is that you are more likely to get your refund sooner (if you are due a refund). While filing your small business taxes early does not guarantee that you’ll get your refund right away, it does make it more likely that you’ll get it sooner. Most people wait till the last minute, which means that the closer you get to the filing deadline, the more bogged-down the IRS is and the slower the process goes.
Or More Time To Pay
It seems logical to file early if you’re getting a refund, but what if you owe? It actually makes sense to file early either way. In most cases, if you owe money, you still have until the filing deadline to pay it. Preparing your taxes early actually gives you more time to arrange your finances to cover owing than if you waited till the last minute and had to scramble to figure out how to pay off your tax liability.
Wiggle Room To Prepare For Problems
In the case where you are preparing your taxes (or your CPA is) and you discover an issue or need time to find additional documentation, having started early gives you that wiggle room. If you wait till the last minute to start, and then find that you don’t have everything you actually need, you will likely have to file an extension (which also takes time). Additionally, the IRS (like most businesses) is still understaffed and overstretched – if you need to call them with questions and wait till the last minute, you will have a harder and more frustrating time getting those answers.
One of the most common types of tax fraud is when someone uses your social security number to file taxes in your name and pocket your refund. While safeguarding your social security number is the best way to prevent this, filing early can also help. If you file early, you have a better chance of getting your true tax return in before scammers do.
Make Following Tax Requirements Easy with The Harding Group
Unlike other accounting firms, The Harding Group will never charge you for consultations and strive for open communication with our clients. We serve clients in Annapolis, Anne Arundel County, Baltimore, Severna Park, and Columbia. If you are ready to take the stress out of tax time as a small business owner, contact us online or give us a call at (410) 573-9991 for a free consultation. Follow us on Facebook, Twitter, YouTube, and LinkedIn for more tax tips.