Need help filing your federal income tax return but don't want to pay a tax preparer? If you made less than $57,000 last year and have access to a computer, you might qualify for the Internal Revenue Service's (IRS) "Free File" service.
To start, go to the IRS website and click on the Free File link. The IRS partners with several tax software companies to provide this free service, and you can choose a company to work with, or choose an option where the IRS will select a company for you.
If you choose a company, do so only after conducting some online research, to see which companies provide the best results in the Free File system. In years past a few companies have produced a few complaints. It's too early to tell if any of those problems remain this year.
Using the free service is one way to make sure that you take advantage of all the tax deductions and credits for which you are eligible.
"If cost is a barrier or if youre wondering about free options, check out IRS.gov for Free File options. Theres something there for almost everybody," said David R. Williams, director, Electronic Tax Administration and Refundable Credits. "Free File is a great choice for either the novice taxpayers who need some assistance or the experienced taxpayers who prefer to do the work themselves. Its fast; its safe; its free."
The Free File program provides free federal income tax preparation and electronic filing for eligible taxpayers through a partnership between the Internal Revenue Service (IRS) approximately 20 private sector tax software companies.
Two Formats
Free File comes in two formats: Traditional Free File, which is available to taxpayers who meet specific criteria and Free File Fillable Forms, which is available to almost all taxpayers.
Approximately 70 percent of the nation's taxpayers, some 98 million people who meet the $57,000 income limit, are eligible for the user-friendly Traditional Free File. Traditional Free File provides step-by-step software help that asks simple questions and puts the answers on the correct tax forms.
Traditional Free File can help taxpayers identify new tax credits or deductions under the American Recovery and Reinvestment Act for which they may be eligible. There are many new and expanded benefits for energy conservation, new car purchases, college tuition and first-time homebuyers.
Taxpayers must go through IRS.gov to access Free File. Each company sets its own eligibility criteria. For example, generally, eligibility criteria are based on state residency, age, income or military service. However, an individual or family with income of $57,000 will find tax preparation software they can use.
Taxpayers either can read over the company offers by clicking "I Will Choose a Company" or get a little help in making the selection by clicking "Help Me Find a Company." With a little information, the tool will display those company offers for which taxpayers may be eligible.
Available In Spanish
Several companies offer their software in Spanish. Several also offer state tax preparation, although fees may apply. Taxpayers are under no obligation to make any purchases from the software companies, the IRS said.
For taxpayers who are comfortable preparing their own tax returns, there's Free File Fillable Forms. Almost everyone is eligible for this service. There are no income limits and almost all tax forms are available.
This service provides electronic versions of IRS paper forms. Taxpayers can complete the tax forms online and file electronically. The fillable forms perform simple math functions, but do not use the question-and-answer software format. Free File Fillable Forms does not support state forms or state electronic filing.
Both Free File versions are highly popular among users. According to a recent survey, 98 percent of Traditional Free File users and 96 percent of Free File Fillable Forms users polled said they would recommend the Free File products to family and friends.
E-File
Taxpayers who use Traditional Free File or Free File Fillable Forms can enjoy all the benefits of IRS e-file -- also for free.
The IRS saves time and money when taxpayers file electronically, so they have encouraged it in recent years. They point that that e-filers get the benefits of a fast refund, reduced error rate and a quick acknowledgement. By using e-file and direct deposit, taxpayers can get a refund in as few as 10 days, the agency says.
If people owe taxes, they also can control their payments and set a date such as April 15 for electronic payment. The error rate for an e-filed return is 1 percent, compared to 20 percent for a paper return. Unlike paper filers, e-filing taxpayers also will receive an acknowledgement that the IRS has received and accepted or rejected their returns.
Taxpayers who are eligible for the $8,000 or the $6,500 first-time homebuyer credit will not be able to e-file because they must attach proof of purchase to their tax return. However, these taxpayers still can use Free File to prepare their tax forms and then print and mail the returns to the IRS.
Free File is available 24-hours a day through April 15. For taxpayers who request an extension to file their federal returns, Free File will be available through October 15.
