3 Reasons to Seek Out Tax Help in January
KEY POINTS
- Many people need assistance in filing a tax return.
- If you don't want to file solo this year, it pays to find a professional to help you this month.
- Searching now means more tax professionals will still have availability, and you may get your refund sooner.
It's a good time to find a reliable tax professional.
Filing a tax return can be complicated. Granted, this may not be true if the only income you're reporting is your salary and the interest you earned in your savings account. But if you're itemizing on your tax return or claiming different deductions related to self-employment, then it absolutely pays to hire a professional to help get your taxes filed.
Some people, however, make the mistake of waiting until February, March, or even April to line up tax help. Here's why it really pays to seek out tax help in January instead.
1. You want the pick of the litter
Tax professionals who are great at what they do tend to get booked up early on in the season. If you want to hire someone with solid experience and a great reputation, start making calls in January. If you wait too long, you might lose out on your first choice due to a lack of availability.
Even if you already have a tax professional you work with, it wouldn't hurt to reach out to them in January, confirm their availability, and let them know you intend to use their services. The last thing you want is to reach out to your tax preparer in March only to learn that they retired in February.
2. You want your refund sooner
The IRS begins accepting tax returns at the end of January. The sooner you file yours, the sooner you can expect your refund to hit your bank account if you're owed money. That's an important thing given the way so many people are having trouble covering bills due to inflation.
But even if you aren't struggling with inflation, your refund represents money the IRS owes you. Why wouldn't you want to set yourself up to get it as early as possible?
3. You're afraid of a big tax bill, and you want to start planning for it
Although most people who file a tax return wind up being due a refund from the IRS, some people end up owing money. If you're convinced you'll land in the latter category, then it definitely pays to line up tax help in January. The sooner you get a sense of what you'll owe, the sooner you can plan for it.
There are penalties and interest that can begin to accrue against you if you don't pay your tax bill in full by the filing deadline -- which, this year, is April 18. If you meet with a tax professional in January and they run some preliminary numbers, you might come to realize that you owe the IRS $7,000 that you don’t have.
At that point, though, there may be options you can play around with in the coming months, like selling some investments to free up cash. So the sooner you get a sense of what your IRS bill looks like, the better.
January may not be a popular time to focus on taxes. But seeking out tax help this month could help you land a great tax preparer, snag your refund sooner, and cope with a giant tax bill.
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