A Fast, Free Way to File Your Federal Income Taxes
Published on - February 11th, 2010 (Modified on - January 15th, 2012) (by J.D. Roth) Tax season is in full swing, and again this year, the Internal Revenue Service is offering a program that allows many U.S. taxpayers to electronically file their tax returns for 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 and the Free File Alliance LLC, a group of private sector tax software companies. Many companies offer free or paid state tax preparation and efiling services. Some companies may not offer state tax preparation and e-file services for all states.
I’ve shared this service with GRS readers in the past, though I forgot to do so last year. This year, I wanted to remind folks early so that they could use it if they qualified.
- For the 2009 tax year, you can use Traditional Free File (where you use tax software with step-by-step help) if your adjusted gross income is $57,000 or less. By using software, you don’t have to do the math, and the programs check your inputs for accuracy. (Note that not every partner company provides state tax preparation.)
- This year there’s also a version of Free File with no income limits. This option doesn’t include any sort of fancy software or step-by-step help; instead, you fill out online versions of blank IRS forms 1040, 1040A, or 1040EZ. (The forms do have basic calculation abilities.) There’s no state option with these free fillable forms.
Free File is a great deal for many people. Check into it if you haven’t done your taxes yet. For more info, read the Free File FAQ at the IRS website. (The IRS website is actually awesome. You can find tons of tax info there. I’m not ashamed to admit that I’ve spent many hours digging through their resources.)
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(The IRS website is actually awesome. You can find tons of tax info there. I’m not ashamed to admit that I’ve spent many hours digging through their resources.)
Maybe you need to get out more J.D.
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Wow, I’ve been waiting for those electronic forms (with simple math built in) for years. Maybe I’ll try that next year. (It’s worth the $10 bucks I’ll pay turbotax just because I already typed everything in there.)
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Keep in mind may sites will do your taxes for “free” regardless of your income. The catch is twofold:
1. If you have anything that is not super simple (i.e., own a house, purchased a car this year, etc.) they will charge you to use the system (“TaxACT Deluxe handles significant changes in our Deluxe edition)
2. Some systems let you do the whole return but then charge you to actually file the return. However, with many of these systems you can print out the forms and send them in the old fashioned way
Just trying to save you some time during tax season,
Jake
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Definitely better than doing it manually, but remember folks – “fast” and “free” aren’t necessarily the best options for something as complicated as income taxes.
(Full disclosure – I’m a CPA.)
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Kevin,
I know it’s bad for business for you for people to do their own taxes, but, considering how much of peoples incomes goes into taxes and tax returns, I think everybody should understand at least the basics of tax preperation.
I started doing my own taxes back when I had my own business and wasn’t making enough to pay an accountant to handle my books and filings. So I took the time to learn how to do it myself.
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Also, for anyone living in California it’s completely free to file your state income tax via the California Franchise Tax Board Website http://www.ftb.ca.gov. They also allow for direct deposit of your tax return into your bank account.
I don’t know if other states offer free filing, but it doesn’t hurt to look at your State Tax entity’s website to see if you can file for free.
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I like irs.gov too, it has helped me greatly with regard to managing my retirement accounts, because the “financial professionals” handling some of them couldn’t answer my questions about rollovers, HSAs, etc!
I started doing our taxes after a few years of paying a CPA $300+ for basically nothing but filling out the forms. (The hard part is putting the records together.) He kept pushing us to put deductions on the Schedule C that we knew weren’t proper, and pushing us to do a Schedule A even though we were nowhere near the numbers to make it worthwhile.
I think if an online service helps someone get through the forms by themselves, it’s great – because they might still choose to file through a CPA, but at least they now have some idea how it should be done.
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For the Canadian readers, some free tax software is StudioTax and UdoTaxes2009.
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In CT you can file your state return online at the Department of Revenue Service’s website, at http://www.ct.gov/drs/cwp/view.asp?a=1433&q=265878. I believe that is a free service.
I’ve also been fascinated by stuff at the IRS website and have spent way more time browsing it than is healthy. You can sign up to get tax tips emailed to you, as well. A lot of the tips haven’t applied to me, but I like that I’ve researched it ahead of time and will recognize the terms when I actually fill out the form, and can skip over it faster (for example, alternative minimum tax). This year is going to be more complex than usual because we’re filing jointly for the first time and (fingers crossed the closing goes smoothly) we’ll also be filing for the first time homebuyer’s credit.
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I just used a service this year https://secure.icanefile.org/eic2009/Welcome.aspx
From their site:
“I-CAN!® E-File was created by a non-profit organization, the Legal Aid Society of Orange County (LASOC), as a tool to help those eligible for the Earned Income Tax Credit and other tax credits file their taxes without being charged excessive fees”
It was fast, easy, and I was never charged a penny. I will definitely be using them again next year.
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I’ve always done my own taxes, without any software, and I used the Free Fillable Forms this year. I was suprised that I had to type out every field from our W2s – surely the IRS has this information? I also had a bit of annoyance with a funky field on the lottery winnings form, but finally got it straight and it basically went OK. I plan to keep using this method in the future. In MA, we can also file our state return for free as well; I started doing that last year.
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off topic –
how about addressing how to invest 5, 10, 15K these days? with high yield savings rates getting lower and lower and the stock market not doing so well either, what would you recommend? Thanks!
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I’ve got an EZ return, so I’ve been using turbotax online for a few years. Before then, I did them on paper with no issues. I typically work in two or more states during the year, and Turbotax has been free for every state I’ve filed in except for Maine, so that’s an extra bonus.
I did pay $15 this year to do the Maine filing. I looked online and thought about downloading all the paper, but I realized that $15 would be a better use of my time than learning tax codes for a state I don’t anticipate working in again.
I do love doing my taxes online, and turbotax helped me realized that I qualify for an EITC and a “making work pay” tax credit this year. I’m sure I would have missed those had I done taxes on paper.
Interesting thing: a few years ago, I did taxes on paper and apparently didn’t fill them out quite right. I didn’t have as big of a tax liability as I thought. I was pleasantly surprised to get a nice check back from the federal government. Then, this year (a good 2 years later), I just got a check back from the state too!
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Warning on Free File where you fill out the forms online. I tried it and it was all going easy until I hit the credit for my new windows. There was no link to add the correct form for the credit, so therefore, you couldn’t add the credit to your 1040. After two calls to the IRS, I gave up and did it the old-fashioned way. And this wasn’t the only form that had no link. I was told “they were working on it.” But for how long?
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Being that filing Taxes is mandatory and the government wants everyone to file electronically, the service should be free.
With that said, Turbo Tax advertises free federal filing, but if you have interest income or dividends or anything but regular wage income you are going to have to pay more. Further, you have to pay for filing your State. Turbo Tax can easily charge you eighty dollars when all is said and done.
I like Tax Act. Fourteen bucks covers everything, and it is as comprehensive as Turbo Tax.
Finally, if you have to file a State Return this free file stinks because you just have to type all your info again to do the State Return.
It is worth thirteen bucks to Tax Act to file both Federal and State and having the program take care of the math.
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Bummer… After reading this post (a helpful one, thank you), I started my research on some of the free software sites. In doing so, I found out that first time home buyers have to send in their federal tax forms through snail mail if they are claiming the first time home buyer tax credit. Well worth the hassle for the $8,000 credit, but it’ll take a little longer to get my hands on that cash now.
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I’ve been using TaxAct for a few years and I’m very happy with it. The free version includes more than any other free tax program that I’ve found. The free version even lets you itemize deductions (1040A), and there is no income limit! You do have to pay if you want to use it for your state return, but my state has a free e-file program, so I just use that. As a bonus, though, TaxAct calculates the state refund, too, so I can use it to double-check what I get using the state software.
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J.D. the IRS website does have loads of valuable information and can be a great resource in many different areas of tax law. 90% of taxes is actually pretty cut and dry and you really only need the IRS’s version to legally pay your minimum tax obligation. There are, of course, some areas when the law can be interpreted differently from the IRS’s opinion, and that is why pros like Kevin M and I will always have jobs.
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For Australians: I’ve found the free Aust Tax Office supplied etax software fantastic the last few years. As well as being easy to use, it asks, at the appropriate questions, whether you’d like it to fill in what it already knows. ie it can go to the ATO’s records for what you’ve paid in income tax, the social security records to fill in automatically what other benefits you’ve been paid etc. and free, and easy. (www.ato.gov.au)
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I’ve been using TaxAct for years… But I always print it out first, triple check it, then click efile.
It’s free, and I don’t mind being extra careful when sending stuff to the government…
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Yesterday, a friend and I tried unsuccessfully to efile her federal return. She had two W-2 and one 1099 form.
Our primary constraint was that we were doing this at the library (not a good idea, I know) and had a maximum of one hour to complete the task.
We slogged through the online forms, typing in every line of all her forms (Employer’s Tax Identification Number, etc). Then we ran into a laundry list – several long pages – of totally unexpected questions, all of which involved esoteric aspects of the Internal Revenue Code and all of which were answered in the negative.
Finally, we were just about done, and we were asked for her 2008 AGI. We totally were not expecting that, so she didn’t think to bring that number with her. We were running out of computer time, and to continue, she was instructed to call some (800) number.
Didn’t think it would be such hassle to efile.
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I too enjoy the IRS’s website. They do have tons and tons of information available to the masses. I have myself used free websites or rather attempted to use free websites in the past but never found any as effecient as ExpressTaxRefund.com or TurboTax.com. I enjoy turbotax’s service but have found it to be overwhelming. For the past two years I have been using ExpressTaxRefund.com. Pretty easy and straight to the point. But to each their own I guess.
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I’ve done my own paper returns for years. I actually kind of enjoy being able to work through and calculate things on my own. This year, I decided to get with the 21st century and try out the free fillable forms Web site that the IRS advertises. It’s total effing crap. I kid you not – if you type quickly enough, the forms will misspell things for you, since they’re made with some weird Flash technology.
So, I gave in and typed everything in very slowly and got the answers I was looking for. At the end, it said “electronic filing error – please submit a paper return” with absolutely NO explanation of any kind. I even went through the trouble of having my 2008 PIN reset with the IRS to make sure that wasn’t the issue. Nothing. The support options on the site were terrible. I guess you get what you pay for.
Anyway, as it turns out, H&R Block’s free program I believe will cover any Federal forms for people making under $57,000 annually. I was surprised that even my Schedule D forms were free since I made stock profits last year. It was so painless, I think I probably will go back to them next year rather than only doing my own work. (Only if it’s free, since they’ve run me and my family through the washer every year I had one of their professionals file for us.) Doing the same with TurboTax would’ve cost me $50 easily.
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