A lot of the daily transactions and activities of modern society are now being accomplished on the Internet, so it is not surprising that filing tax returns can now also be done online with Free File from the IRS.
Since 2003, the Internal Revenue Service has partnered with some of the leading tax preparation software providers to offer a service called Free File, which allows qualified taxpayers to electronically file their returns as well as receive their refunds through direct deposits to their bank accounts.
The service is free, and you do not have to purchase or download any software to use the Free File service. It is also more convenient; as soon as you have your information available, such as your W-2 form from your employer, you can complete the filing process right in the comfort of your home. Here’s a short video explaining it:
Free File Video:
Perhaps the most attractive advantage to Free File, of course, is the fact that you will get your refund much faster than if you file the return the traditional way. When you enter your bank account information, the money can be deposited electronically within a few days (there is a tracking number so you know where your money is and how soon it will be available).
Can I Use Free File For My Tax Returns?
Not every taxpayer can use the Free File option, as there are general qualifications. It is only available for individual returns, not business returns (but entrepreneurs who file Schedule C with their Form 1040 can use the service).
Also, your adjusted gross income (AGI) can not be more than $57,000. If it is, then they have setup interactive forms for you. They aren’t as convenient as using a tax service, but you can still file for free through the service.
Getting Started with Free File
To get started, you simply have to go to the IRS website (www.irs.gov) and click on the link for Free File.
The different software companies that have partnered with the IRS for Free File also have their own requirements for eligibility, but the good news is if you do not qualify to file through one of the providers, you can just try with another one that can help you.
The list of different companies and their requirements can also be found on the IRS website’s Search tool.
Where’s My Tax Refund?
The IRS also has a service called “Where’s my Refund?” which lets you see where your refund is in process at. Here is a short video explaining it:
This year, an estimated 70% of taxpayers are qualified to participate in Free File. An additional program by the IRS in connection with Free File is the federal Volunteer Income Tax Assistance or VITA.
This program sets up tax-filing clinics and help desks in public places, where volunteers can assist low- and middle-income taxpayers who can not afford professional filing help or software. Free File kiosks will also be available in VITA tax clinics.
It is recommended that you go to the IRS website and follow the Free File links and resources there, but you can also go directly to the websites of the companies that participate in the program.
Some examples are TaxACT Free File Edition, H&R Block’s Free File, Tax Slayer, and Turbo Tax Freedom Edition.