Thinking of filing your taxes early this year? It’s a wise decision to be sure, but there are some important things to keep in mind. There are a number of changes in the offing for the upcoming tax season, some of which you may welcome, and some that may put a damper on your plans. Here are five simple predictions that may seem fairly obvious, but could potentially affect everyone who is planning to file their taxes across the nation this year.
1.) Refunds could be delayed
Yes, you read that correctly. Rumor has it that refunds will be delayed this upcoming tax season, regardless of whether you file your taxes early or late. In a press release by the IRS, it is clearly stated:
“Beginning in 2017, a new law requires the IRS to hold refunds on tax returns claiming the Earned Income Tax Credit (EITC) or the Additional Child Tax Credit (ACTC) until mid-February. Under the change required by Congress in the Protecting Americans from Tax Hikes (PATH) Act, the IRS must hold the entire refund — even the portion not associated with the EITC and ACTC — until at least Feb. 15. This change helps ensure that taxpayers get the refund they are owed by giving the agency more time to help detect and prevent fraud.”
Based on that statement, it is reasonable to expect that your refund will be delayed, regardless of whether you file your taxes early or you wait until the last minute to do so.
2.) Error and mistakes will be reduced
Check your statement carefully, then go back and check it all again. In any case, there will likely be a lot more amendments than usual this coming tax season. Give yourself plenty of time to review all requested documentations to make sure your statement is complete and accurate. Most importantly, remember every little detail that the IRS requires.
3.) Self-prepare tax filers will increase
More and more people are taking advantage of the continually improving tax preparation software available online. With all the quality tools available, more people are likely to take on the task of filing their taxes themselves.
The IRS actually offers a number of excellent solutions, some of them for free. Paid options such as TurboTax and TaxSlayer continue to be useful and easy-to-use as well. Each site and software has its own unique advantages and disadvantages, so make sure you take the time to educate yourself on which system is best suited to your needs.
4.) Healthcare collection is here to stay
If you voted for Trump with the hope of seeing Obamacare and its associated tax penalties coming to an end, you might want to readjust your expectations. All indications point to healthcare costs sticking around for a while. Even with the upcoming changes in store, there is likely to be a great deal of confusion with regard to how you can save on taxes and avoid penalties. It is safe to say that healthcare costs and coverage are still going to be talked about issues for years to come.
5.) The deadline for filing taxes will change this year
Although the deadline for filing taxes is usually the same every year, a safe prediction is that you will get a few days leeway this year. This is because the traditional deadline for filing taxes falls on a weekend. This could be a good thing for those who typically wait ’til the last minute to file their taxes.