Tax season is here—4 reasons to file your return early

If you’re not in a hurry to file your taxes, you’re not alone. Nearly one in four Americans said they would wait until the last minute to apply, according to a 2025 survey by financial services firm IPX1031.

But there are practical reasons to consider filing early, starting Jan. 26, when the Internal Revenue Service begins federal tax filing season.

And the National Taxpayer Advocate Service, an independent watchdog within the IRS, says timing may be even more important this year than in previous years, as IRS staff cuts have increased operational burdens.

Here are four reasons why tax experts say it’s worth considering filing well before the April 15 deadline, and one reason why you might be better off waiting. Although these are general guidelines, we recommend consulting with a tax professional to determine what is appropriate for you.

One of the easiest reasons to apply early is speed. Most refunds for electronically filed returns will be made within approximately 21 days of receipt if you choose direct deposit, which is the fastest way to receive your funds. If you file a paper return or receive your refund by mail, expect it to take at least six to eight weeks, according to the IRS.

This is significant considering that the average federal tax refund is in the thousands of dollars, with IRS filing season data showing the average refund for the 2024 tax year is just over $3,000.

“Even if there are IRS staffing issues, early filers are usually first in line when the process starts,” Joon Eum, an IRS-registered agent and certified financial planner in Los Angeles, told CNBC Make It.

Just because you file early doesn’t mean you have to pay your taxes early. Even if you file your return in January or February, your taxes will not be paid until the April filing deadline.

This buffer is especially useful if you have a balance on your return. By preparing early, you’ll have time to plan how you’ll cover your bills instead of scrambling at the last minute. This can be even more important for freelancers, gig workers, or people whose withholdings don’t cover enough taxes to pay, said Randy Bruns, a certified financial planner in Illinois.

A completed tax return is often required to proceed with important financial processes, such as qualifying for a mortgage, applying for the income-restricted housing lottery, and verifying eligibility for health insurance subsidies.

In these situations, a filed return can serve as proof of income because it reflects the actual amount you earned during the year, rather than an estimate. This can be especially helpful for people with fluctuating incomes, such as the self-employed and freelancers, Brands says.

In some cases, if your income has decreased compared to the previous year, you may qualify for certain income-based programs, such as health insurance subsidies or some housing programs. Having a recently filed return can help document a decrease in income if proof is needed, allowing eligibility to be reviewed more quickly, Brands says.

For the Affordable Care Act, eligibility is determined based on projected income, but if your application is flagged for review, a recently filed return may help support the decrease in income.

“It doesn’t override the predictions, but it supports them and speeds resolution when questions arise,” Bruns says.

According to Turbo Tax, filing early can reduce the risk of tax-related identity theft, which often occurs at the beginning of filing season.

Criminals can use stolen Social Security numbers to file fraudulent returns and claim refunds before legitimate taxpayers file. If that happens, the actual return could be delayed or flagged while the IRS sorts out the discrepancies.

To reduce your chances of being scammed, the IRS offers an optional Privacy PIN. This prevents you from using your Social Security number to file a tax return unless you have the correct six-digit code.

While filing early makes sense for many taxpayers, it’s not the right course of action for everyone.

Early filing tends to be most effective for people with relatively simple salary-based income and completed paperwork. Taxpayers with investment income, side hustle or pass-through business income may benefit from waiting, as important tax returns may be delayed or amended, Um said.

These taxpayers may wish to delay filing until they have received all expected Forms W-2, Form 1099, or Schedule K-1. That’s because submitting before all documents arrive can increase the risk of errors and amended returns, says Um.

“Submitting too early and fixing it later usually creates more problems than it solves,” he added.

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