DON'T BE IN A HURRY!

 

The IRS has announced that the tax filing season for 2026 will begin on January 26, 2026.

However – here is some good advice I have been giving to taxpayers for almost two decades.

You shouldn’t wait till the last minute to prepare your tax return.  But don’t rush to be among the first taxpayers of the year to have your taxes done.

Do not visit your tax professional, or prepare your tax return, until you are sure you have received ALL information returns and documentation from ALL sources.

Before I retired the “tax filing season” always officially began for me on February 1st.  I told my clients not to give me their “stuff” until then, and rarely prepared a tax return before the 1st of February unless both the client and I are sure that he/she has received everything necessary to properly prepare the return.

The reason I chose February 1st is because, under federal law, all W-2s, 1099s and 1098s are required to be furnished to taxpayers by January 31st (unless the 31st falls on a week-end). The instructions for these forms state that the “furnish” requirement will be met if the form is properly addressed and mailed on January 31st.  Plus, most banks, brokerages, mortgage companies, colleges, and the like are not able to send out 1099s and 1098s until the end of the January.

Decades ago, when I still had a storefront office open to the public, a long-time client came in on the morning of February 1st to have his return prepared.  He had received all the 1099s for interest and dividends for all accounts and investments as well as the 1099s for Social Security and pensions.  Upon reviewing the documents, he presented to me I found that he had a form for every source of income he had reported on the previous year’s return.  He told me he had not sold any stock during the year, and that there had been no spin-offs, mergers or “cash in lieu” for fractional shares.  So, I prepared the federal and state returns.

He left the office with the completed returns happy in the thought that he was finished with his “uncles” for the year and pleased with himself for being so early.  He returned home, signed the returns with his wife, and went directly to the Post Office to mail the returns.

The next afternoon I got a call from the client.  He had gotten another 1099-R in the mail that morning!  His wife received a pension from Lucent Technologies and, while the amount of the annual pension generally remained constant, early in the year Lucent had made a special one-time distribution to its retirees from a fund other than the regular pension fund,and issued a separate 1099-R for this distribution.

The client returned to my office that afternoon and I prepared amended returns, for an additional fee, to claim the income and withholding from the new 1099-R.  I instructed him to wait to mail the amended returns until he received the refund checks from the original returns, so as not to confuse the IRS and NJ by having two returns in the system at the same time.  The bottom line is the client had to pay twice for filing his returns.

If you have a brokerage account there is an excellent chance that you will receive at least one corrected “Consolidated 1099 Statement” or “Tax Reporting Statement” to report taxable dividends, interest and gross proceeds after the initial statement arrives in late January or early February. The final corrected 1099 may not arrive until mid-March.  

And if you have invested in a limited partnership the GDMF Form K-1 will probably not arrive until at least mid-March – and possibly not until August!  This is also the case if you were the beneficiary of the estate of a deceased person – you may be receiving a Form K-1 from the estate.  You should check with the Executor to see if one will be issued.

So, to repeat – don’t be in a hurry to be among the first to file your tax return. 

TTFN