The IRS Free File Program is a service that allows U.S. taxpayers to prepare and e-file their federal income

tax return A tax return is the completion of documentation that calculates an entity or individual's income earned and the amount of taxes to be paid to the government or government organizations or, potentially, back to the taxpayer. Taxation is one of ...

s for free. Through the program, commercial tax software companies that are part of the

Free File Alliance The Free File Alliance is a group of tax preparation companies which operate a public-private partnership with the Internal Revenue Service (IRS) to provide free electronic tax filing services under the IRS Free File program to United States taxp ...

offer free tax preparation software to tax filers with annual adjusted gross income (AGI) below $73,000 for Tax Year 2021. The AGI is adjusted and typically increases slightly for each tax-filing season.IRS.gov
www.irs.gov/freefile
/ref> The service is available through the IRS's website a
www.irs.gov/freefile
Fillable forms also are available to all taxpayers as part of the Free File Program. More than 65 million American taxpayers have used Free File since its inception in 2003. Using a conservative savings estimate of $30 per return, the IRS Free File Program has saved taxpayers nearly $2 billion that they otherwise would have spent for tax preparation during this period. Through the program, 70% of U.S. taxpayers are eligible to use commercial software for free to file their tax returns, though less than 5% of eligible individuals do so. In 2019, investigations by

ProPublica ProPublica (), legally Pro Publica, Inc., is a nonprofit organization based in New York City. In 2010, it became the first online news source to win a Pulitzer Prize, for a piece written by one of its journalists''The Guardian'', April 13, 2010P ...

asserted that companies such as

Intuit Intuit Inc. is an American business software company that specializes in financial software. The company is headquartered in Mountain View, California, and the CEO is Sasan Goodarzi. Intuit's products include the tax preparation application Tu ...

(makers of TurboTax) and

H&R Block H&R Block, Inc., or H&R Block, is an American tax preparation company operating in Canada, the United States, and Australia. The company was founded in 1955 by brothers Henry W. Bloch and Richard Bloch. As of 2018, H&R Block operates approximat ...

allegedly misled taxpayers into paying for tax preparation services despite qualifying under the Free File Program. Subsequent investigations by the

Senate Committee on Homeland Security and Governmental Affairs The United States Senate Committee on Homeland Security and Governmental Affairs is the chief oversight committee of the United States Senate. It has jurisdiction over matters related to the Department of Homeland Security and other homeland s ...

and the

New York State Department of Financial Services The New York State Department of Financial Services (DFS or NYSDFS) is the department of the New York state government responsible for regulating financial services and products, including those subject to the New York insurance, banking and fina ...

confirmed these findings. As of the 2021 tax filing season, the two most used tax-filing software programs (TurboTax and H&R Block) no longer participate in the Free File Program. With the two largest members of the Free File Alliance ending their participation in the Free File Program, there have been renewed calls for the IRS to develop and offer their own free tax-filing software to taxpayers.

History

In November 2001, the U.S. Office of Management and Budget's (OMB) Quicksilver Task Force established 24 e-government initiatives that were a part of the President's Management Agenda. These initiatives were designed to improve Government to Government, Government to Business, and Government to Citizen electronic capabilities. One initiative, IRS Free File, instructed the IRS to provide free and secure online tax return preparation and filing services to taxpayers. In accordance with this OMB directive, the IRS began working in partnership with the tax software industry to develop a solution. The result was the formation of the Free File Alliance, LLC, a group of tax software companies who provide free commercial online tax preparation and electronic filing services. According to investigations by the news organization

, TurboTax maker

allegedly engaged in practices that hid the Free File Program from eligible taxpayers, and attempted to trick eligible taxpayers into paying for services they might be eligible to receive for free. In 2020, H&R Block ended its participation in the Free File Program. In July 2021, Intuit announced that its TurboTax product would no longer participate in the Free File Program effective as of the 2021 tax season. For tax-filing season 2022, eight tax software companies are participating in the Free File Program.

Free File Alliance

The Free File Alliance is a consortium of commercial tax preparation software providers that offer their brand-name tax software products for free to lower and middle-income tax filers. Each member is allowed to set eligibility requirements for their software products. However, the cumulative offers must allow 70 percent of U.S. taxpayers - approximately 100 million people - to be eligible for at least one product. Each year, the income limit for eligibility is adjusted to reach 70 percent of the taxpayers. The income limit for 2022 (tax year 2021) is set at $73,000, though some Free File software providers choose to set the income threshold lower. Agreements between the IRS and the Free File Alliance are publicly available. The latest Memorandum of Understanding was signed in 2021 and runs through 2023.

Free File Software

The Free File Program, a public-private partnership between IRS and private-sector tax software companies, allows lower- and middle-income taxpayers to use name-brand tax preparation software to prepare and file tax forms for free. For 2022, anyone whose

adjusted gross income In the United States income tax system, adjusted gross income (AGI) is an individual's total gross income minus specific deductions. It is used to calculate taxable income, which is AGI minus allowances for personal exemptions and itemized deduc ...

is $73,000 or less will be eligible for at least one software product. There are 8 products from which to choose. Each software provider sets its own eligibility requirements, generally related to income, state residency, age, military service or eligibility for the

earned income tax credit The United States federal earned income tax credit or earned income credit (EITC or EIC) is a refundable tax credit for low- to moderate-income working individuals and couples, particularly those with children. The amount of EITC benefit depends ...

. Free File is free for federal tax returns only. However, some Free File Alliance members offer state return software for a fee or for free. Most of the software products, but not all, use an interview format in which you are asked questions and your answers are used to populate the electronic form. This format helps taxpayers get the tax credits and deductions to which they are eligible. It also means taxpayers do not have to be experts in income tax law. Alliance members cannot sell any

refund anticipation loan Refund anticipation loan (RAL) is a short-term consumer loan in the United States provided by a third party against an expected tax refund for the duration it takes the tax authority to pay the refund. The loan term was usually about two to three w ...

products through the Free File service. To use IRS Free File, taxpayers generally go through the IRS website a
www.irs.gov/freefile
There, taxpayers can find a tax software product one of two ways. They can review a list of companies and their offers. Or, they can use a simple web tool that asks a few questions - such as income, state residency and age - and the tool will locate those software products for which taxpayers are eligible. Once a taxpayer chooses a product, they will be directed off the IRS.gov site and onto the Alliance member's website to complete their federal tax return. Taxpayers can also access the free file option of the participating software companies by accessing the direct links below. For tax year 2021, there are 8 participating Free File Alliance members with the following requirements to qualify to use their software for free under the Free File program:
FreeTaxUSA.com
AGI of $41,000 or less. Free state return included.
OnLineTaxes.com
AGI between $16,000 and $73,000. Free state return included.
TaxAct.com
AGI of $65,000 or less, and age 56 or younger. Free state return in some states.
TaxSlayer.com
AGI of $39,000 or less. Free state return in some states.
FileYourTaxes.com
AGI between $9,500 and $73,000, and age 65 or younger. Free state return in some states.

AGI of $73,000 or less, and living in certain states. No free state returns.
Free1040TaxReturn.com
AGI of $73,000 or less, and living in certain states. No free state returns.
ezTaxReturn.com
AGI of $73,000 or less, and living in certain states. No free state returns.

Free File Fillable Forms

Another component of Free File is Free File Fillable Forms, which is available to all taxpayers, including taxpayers whose adjusted gross incomes (AGI) are greater than $73,000. It is an alternative to Free File Software, although both are free. Free File Fillable Forms is operated by a private organization, the

and not the IRS. Though IRS links to it, they do not endorse it or any product.{{cite web , url=https://www.freefilefillableforms.com/ , title=Home , website=freefilefillableforms.comBefore Starting Free File Fillable Forms https://www.irs.gov/e-file-providers/before-starting-free-file-fillable-formsFree File Fillable Forms General FAQs https://www.irs.gov/pub/irs-utl/2012_4f_faqs.pdf"IRS, Free File Alliance announce changes to improve program" https://www.irs.gov/newsroom/irs-free-file-alliance-announce-changes-to-improve-program-improved-taxpayer-options-available-for-2019-free-file-program Free File Fillable Forms is an electronic version of IRS paper forms. Free File Fillable Forms does not include any elaborate cross-checking or question-and-answer formats (such as is found in many of the Free File Software packages), instead it is a simple fill-in-the blank format (however, it does perform math calculations). Free File Fillable Forms is best for taxpayers who are comfortable preparing their own tax returns or who have been long-time paper filers. There are no income restrictions for using Free File Fillable Forms. It does not support any state tax returns.Free File: Do Your Federal Taxes for Free https://www.irs.gov/filing/free-file-do-your-federal-taxes-for-free

References

External links

* http://www.freefilealliance.org/ * https://www.irs.gov/FreeFile
free_file_agreement
- irs.gov
Free File Software Offers
- irs.gov
Free File Software Lookup Tool
- irs.gov
Free File: Everyone Can File an Extension for Free
- irs.gov
Free File: Do Your Federal Taxes for Free
- irs.gov
Free File Fillable Forms
Taxation in the United States Internal Revenue Service