Completing your tax returns isn't ever a fun project, but many people are eager to get it done as soon as possible. Whether you're waiting for a refund or simply want to get filing over with, there are lots of reasons you may be wondering when you can submit your tax return.
The good news is, the IRS has now announced when tax filing season opens in 2021 for the 2020 tax year. Here's what you need to know.
This is the first day you can file taxes for the 2020 tax year
According to the IRS, tax filing season will open on Feb. 12, 2021. This is the first date the agency will begin accepting and processing returns for 2020.
This date may come as a surprise to you if you've always filed your returns right away. See, the IRS usually opens up filing season somewhere during the end of January. But this year, it'll be close to the middle of February before your forms will be accepted.
In its announcement of the Feb. 12 date, the agency explained the delay was caused by the need to complete programming and testing of its systems. It was unable to focus on these tasks before because it was vested with responsibility for distributing $600 stimulus checks to millions of Americans after lawmakers passed a coronavirus relief bill at the end of December.
What does this mean for your refund?
This delayed start to the tax filing season may be a financial burden for you if you were hoping to claim your tax refund ASAP.
The IRS is, however, urging that you submit your returns electronically and provide direct deposit information if your goal is to get your money as soon as possible.
Most people will get their refunds within 21 days of electronic filing, while those claiming the Earned Income Tax Credit and the American Opportunity Tax Credit will first start getting refund checks in early March. The IRS is required by law to delay refunds to taxpayers who claim these credits. However, the agency indicated the timeline for refunds for those who claim these credits won't be much different in 2021 than in other years.
Why it can be smart to file your tax returns as soon as possible when filing season opens
While tax filing season opens Feb. 12, you aren't required to submit your tax return immediately. In fact, you'll have until April 15 to send in your forms and pay the taxes due without incurring any penalties.
But just because filing early is optional doesn't mean you should delay. The sooner you send in your returns, the sooner you can get back the money the government has been borrowing from you. If you didn't receive the full amount of either of your two coronavirus stimulus checks, you can also claim that money by filing a tax return.
Submitting your returns early also reduces the risk of identity theft. If someone else files a fraudulent return in your name, this creates a lot of financial hassle for you. If you've submitted your return before a scammer tries to steal your identity, they'll be thwarted.
Feb. 12 is coming up fast, so it's time to start getting your tax paperwork together so you'll be ready to submit your forms on that date or as close to it as possible. When you can put the tax filing process behind you, you should be left feeling a little better about your financial situation.