3 Times Filing Taxes Early Can Actually Save You Money, According to a CPA
The first few months of the year are busy. With so much to manage in your daily life, adding one more task — like filing your taxes early — can feel overwhelming. Why put the pressure on yourself when you technically have until April 15, 2026, to get everything in?
Here’s one good reason: In certain circumstances, filing early can actually save you money.
Don’t believe us? MoneyLion talked to a professional to get the scoop. We sat down with Gene Bott, a CPA, tax advisor and partner at Tax Hive, to learn when filing early can pay off. It may be worth chasing down all those forms sooner rather than later.
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When You Owe Taxes
If you’re behind on taxes — especially estimated payments — Bott says you should pay early to avoid accruing interest and penalties.
“The IRS charges interest and penalties for those who are behind on payments,” he said. “The earlier you file and pay this bill, the smaller your interest and penalty bill will be.”
The IRS typically adds a failure-to-pay penalty if you don’t pay your taxes by the due date. The penalty is 0.5% of the unpaid amount per month, or part of a month, up to a maximum of 25%. Until you’ve paid the balance or reached the cap, that penalty continues to accrue monthly.
It’s better to pay what you owe as early as possible.
When You’re Claiming Dependents
Bott also encourages filing early if you plan to claim dependents or refundable credits such as the Child Tax Credit. His reason may surprise you: These credits are frequent targets for fraudsters, meaning someone could try to file a fraudulent return and claim them before you do.
Yes, it happens more often than you’d think.
“This is especially true when there are issues related to claiming children in a divorce,” he said. “Filing early can ensure you get the credit before others have a chance to steal it.”
Filing early helps close the window for someone else to claim:
Your child or dependent
Refundable credits tied to that dependent
Head of Household filing status
During a divorce or custody arrangement, only one parent can claim the dependent in a given tax year, depending on court orders, custody agreements or IRS tie-breaker rules. If both parents try to claim the same child, the IRS will disallow one of the claims — often after issuing a refund. That can trigger demands for repayment, plus penalties and interest.
Bott is clear: Claiming a credit you aren’t entitled to is fraudulent. If a court order specifies that the credit isn’t yours in a particular year, you shouldn’t rush to file just to claim it. You could face IRS penalties.
But if you’re entitled to claim it, filing early can protect you.
When You Need the Best Service From a Tax Preparer
Ideally, tax preparers give 100% effort to every client. But they’re human — and their workload intensifies as Tax Day approaches. To ensure you receive the most focused service possible, consider filing early.
“Filing before they become so busy means you get more attention and quicker results,” Bott said.
When You Shouldn’t File Early
That said, Bott notes there are times when delaying — or even filing for an extension — makes sense.
“If, for example, you can’t have accurate information before the deadline, it’s best to delay filing until you can,” he said. “This is especially true for business owners, as some tax-planning opportunities may be lost once the original return is filed. Just don’t delay paying your expected tax bill.”
The Bottom Line
If you have your documents in order and are confident about the credits you’re claiming — especially those related to dependents — filing early can work in your favor. You’ll likely receive more attention from your preparer, and you may avoid unnecessary costs or penalties.
This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal, or tax advice.
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