Advertisement

Early tax filers get cash faster

January 26, 1999|By KERRY LYNN FRALEY

When it comes to income taxes, Dana Redman doesn't procrastinate.

Expecting to get a refund of more than $700 this year, Redman, 30, said she went to her tax preparer at the beginning of the week and had him file her tax return by computer, or e-file.

The Smithsburg resident said she files her return as soon as possible every year. For the past three years she has opted for e-filing, which gets the refund to her much faster than the traditional way.

[cont. from front page]

"My reason is pure and simple. I'm a single mother and I'm looking forward to the extra money to do extra stuff with my kid," said Redman, who plans to take her 3-year-old daughter shopping and out to dinner with her refund.

Advertisement

While the filing rush won't start until the first week in February, Tri-State area tax preparers say they have begun getting business from filers anxious to receive refunds.

Like Redman, many early birds are filing electronically to get their refund as soon as possible, they said.

People could start filing by computer on Jan. 15.

It's not surprising that a lot of people file as soon as they get the needed W-2s, 1099s and other tax forms, Internal Revenue Service spokesman Domenic LaPonzina said.

Three out of four taxpayers are due refunds, LaPonzina said.

Federal refunds averaged $1,350 and state refunds averaged $400 in this area last year, he said.

"That's a pretty good chunk of change. The sooner they file, the sooner they get it back," LaPonzina said.

Speed is one of the benefits of the IRS's three electronic filing options - TeleFile by phone for those who qualify, e-file by a paid preparer and On-Line Filing by personal computer, he said.

The average refund from a return filed electronically arrives in half the time of a paper return - 2 1/2 weeks vs. five weeks, LaPonzina said.

Last year, one out of five taxpayers filed electronically, he said.

The IRS is projecting eight out of 10 taxpayers will take advantage of electronic filing by 2007, LaPonzina said.

Hagerstown tax preparer Paul Cox, of Professional Tax Service on East Franklin Street, said eight of the 15 returns he'd prepared as of Thursday were e-files.

"The ones that I'm getting right now are the ones looking for refunds and doing it electronically," Cox said.

He said he'd already given out three checks to people who'd chosen the option of a refund anticipation loan, in which the participating bank cuts a fee out of the refund.

For clients expecting a large refund, the extra fee is often worth the two or three day turnaround, Cox said.

Area Jackson Hewitt Tax Service offices were swamped by early filers on Friday, Bev Stitely said. She said that based on nine years in the area, she had projected the rush would start on the next to the last payday of January.

Early filers are usually those who can use the short tax form and need only file the W-2 form their employer provides, said Stitely, general manager of 27 Jackson Hewitt Tax Service offices, including those in Hagerstown, Frederick, Md., Martinsburg, W.Va., Charles Town, W.Va., and Chambersburg, Pa.

Tax preparer Edna Wauls, of Cosey's Tax Service near Chambersburg, Pa., said the same filing pattern has held true for the more than three decades she has been preparing taxes.

The people expecting refunds usually file early while those who have to pay wait, sometimes until right before the filing deadline, Wauls said.

As of Thursday afternoon, Wauls said she'd had only two filers, both expecting substantial refunds.

Accountant Alex Shaw, of Shaw & Shaw Accounting Corp. CPAs in Shepherstown, W.Va., said he doesn't get many early filers because of the nature of his business.

Shaw said his clients are mainly businesses and individuals who need more than basic information to file with their returns.

Accountant Lance Gercke at The Bottom Line in Funkstown said he discourages clients from coming in too early for tax preparation.

"Unless you're 100 percent sure you've received all your documents, filing this early is pretty risky," said Gercke, who has been preparing taxes since the late 1980s.

If you file without all the necessary paperwork, you have to file an amended return, an "unnecessary headache," he said.

Hagerstown resident Beth Bonebrake said she files her tax returns early every year knowing she's going to get money back.

"As soon as I get my W-2s back, I file," said Bonebrake, 26, who went to a tax preparer on Friday.

After several years of hearing about it, she decided to try electronic filing, she said.

"This year, I needed my money," Bonebrake said.

The Herald-Mail Articles
|
|
|