The early bird avoids tax fraud

There’s a lot you may be thinking about as the year comes to an end. What should I get relatives for Christmas? How are my finances looking going into the New Year? Is it worth starting another New Year’s diet come January 1? But something you should also have on your radar is your 2015 income tax return.

You might be thinking, Why would I be thinking about my tax return so early? I won’t even get any relevant paperwork for another month!

However, one of the easiest ways to avoid tax fraud is by beating crooks to the punch. Thefts occur when someone files a fake return with your name and social security number and requests the refund be funneled into their account. When this occurs, the actual owner of the social security number has to spend countless hours and submit significant amounts of paperwork to prove their identity and claim the refund. However, if you file your return before anybody else could, you avoid this messy process.

While it’s true that you do have to wait on W-2s and 1099s, there are plenty of other steps you could take to make sure your taxes are filed at the earliest possible time. You could calculate your charitable contributions from the year, determine medical expenses, look into the tax implications of rental properties or businesses you may own, or even schedule the earliest possible appointment with your tax preparer. Come January, you will have many of the necessary calculations made and documents ready, so when your W-2s or 1099s arrive, you can get everything squared away quickly.

You should also make sure you are keeping a close eye on your mailbox come January to protect these important tax documents. With speed and prudence, you should be able to avoid tax fraud and a stressful tax season!

Source: USA Today