IRS Free File Now Open For Business

If you would like to use the Internal Revenue Service (IRS) Free File service, it's now open for business for the 2011 tax filing year, the IRS said.

As the name implies, Free File is a free tax-preparation service that taxpayers can use online. According to the tax agency, more 33 million returns have been filed through Free File since its debut.

Everyone can use Free File, but there is an income limit for using the free tax preparation software the IRS offers through a number of commercial partners. To use the software, you must have an adjusted gross income of $57,000 or less.

Free File Fillable Forms, the electronic version of IRS paper forms, has no income restrictions. The only difference is, you have to prepare your taxes yourself.

“Free File can save you time and money,” said Diane Fox, director, Free File program. “You can prepare and e-file your tax return at no charge. And, the software helps you find the tax breaks you are due. Free File helps make taxes less taxing.”

Most taxpayers eligible for free software

The IRS estimates that 70 percent of taxpayers fall into the category that allows them to use the free tax preparation software. To get started, click here. 

All Free File members must meet certain security requirements and use the latest in encryption technology to protect taxpayers’ information.

People with an adjusted gross income of $57,000 or less are eligible for at least one software product if not more. Each of the Free File software providers sets their own eligibility requirements, usually based on qualifiers such as income, state residency, age or military status.

The easiest way to locate a software provider is to use the online “get help” tool at the IRS website, with a little of a taxpayer’s information such as income, age and state residency, can identify matching free-file products. Or, taxpayers can review all providers and their offers. Some software providers also offer state income tax preparation for free or for a fee.

Volunteer help

Also, the IRS is working with select volunteer tax sites such as Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly. There are 200 locations nationwide that have set up Free File kiosks where taxpayers can use computers to prepare their own returns with Free File.

For taxpayers whose incomes are more than $57,000, there’s Free File Fillable Forms, also available at the IRS website. This program is best for taxpayers experienced in preparing their own federal tax returns. For people who prefer doing their taxes the old fashioned way – by paper – this is an electronic alternative.

Free File Fillable Forms performs some math calculations and provides links to some IRS publications. It does not use the familiar question-and-answer format used by software. Taxpayers can e-file the forms for free. It also does not support state income tax returns.

Taxpayers must access the free-file products through IRS.gov or authorized kiosks.