Why You Should File Your Taxes Early

  • Are you a procrastinator? I know that I can be. Waiting until the last minute before something has to be done. When it comes to taxes many people are. Each year people are lining up at the last minute to get their return post marked on time.

     

    If that's you, please listen up. Here's a reason why you shouldn't wait until the last minute. IRS ID theft.

     

    The scam is easy and relatively safe for the scammer. They take your SS# and file for a refund. They'll often use forged W-2 forms and e-file. The refund comes to them as a debit card. Once they get that they're gone and very hard to catch.

     

    According to the U.S. Justice Department "Typically SIRF (Stolen Identity Refund Fraud) perpetrators file the false returns electronically, early in the tax filing season so that the IRS receives the false SIRF return before legitimate taxpayers have time to file their returns. The SIRF perpetrators arrange to have the refunds electronically transferred to debit cards or delivered to addresses where they can steal the refund out of the mail."

     

    The IRS reports that last year they had over 35,000 fraudulent returns filed by February 29th.

     

    How much did they get away with? I couldn't find any stats for last year, but it appears that in 2013 $30 billion in fraudulent claims were made and the IRS managed to stop or recover $24 billion. So subtraction says that $6 billion was stolen!

     

    How would it affect you? Recently a friend tried to file his return looking for a nice refund. Unfortunately it appears that someone got to it first. Now he has had to file a form to find out if someone has claimed a refund under his SS#. It could take months to straighten out. In the meantime, there won't be any refund coming to him. It happened to my mother a few years ago and it took over a year to get her refund.

     

    Besides protecting your SS# there's not much you can do to protect yourself. So you might want to spend some time working on that 1040 this week and file your taxes as soon as possible.

     

    Oh, and if you're looking for software to help you prepare your taxes we recommend TurboTax. There are lots of products available. But with all the tax law changes I want to use a software program that's proven it's worth for many years.

     

    Keep on Stretching those Dollars!
    Gary


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