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Free Tax Filing Resources

Posted By Jim On 02/09/2009 @ 7:10 am In Taxes | 8 Comments

We’re deep in the throes of tax season and with the economy in the sorry shape that it’s in, I’m sure many taxpayers are looking to gain an edge. I mean we’re already paying taxes, surely it makes less sense that we have to pay to figure out how much we’re going to pay in taxes right? Fortunately, there are a lot of different ways you can get tax filing software or assistance absolutely free.

In addition to the nationally available programs I’m about the list, there are also a lot of local programs. Each state’s tax website will usually list the free tax filing resources or services available in the state. many of these are simply listings of data made available through the IRS Free File system but you might be able to find some gems in there as well.

Beware Scams: Since it is tax season, there will be a lot of scams floating around. Be very careful who you work with and always confirm that they are an “Authorized IRS e-file Provider” before you start working with them. You can use the IRS’s search tool to find e-file Providers [3] but be sure to do your due diligence. Remember, you need to trust the company or person you are working with because you are giving them every bit of information they need to steal your identity. If you can’t confirm something, call up an IRS Taxpayer Assistance Center (find them using this map [4]).

Demographic Specific Resources

These are resources available to individuals who qualify as part of a specific demographic, based on age, income, or some other qualification.

Volunteer Income Tax Assistance Program

The VITA Program is a group of volunteers who help low to moderate income people with their tax returns. The volunteers will help you fill out your return, you can find VITA sites by calling 1-800-829-1040 (it’s the IRS help line) or reading about the program [5] on the IRS website (including what to bring, etc.).

Elderly Tax Counseling

If you are aged 60+, you can get assistance through the Tax Counseling for the Elderly Program (TCE) which is, in part, supported by the AARP and their Tax-Aide counseling program. You can find out more at the AARP’s Tax-Aide site [6].

IRS Free File

The Free File program [7] is run by the Internal Revenue Service and “provides free federal income tax preparation and electronic filing for eligible taxpayers through a partnership between the Internal Revenue Service (IRS) and the Free File Alliance LLC, a group of private sector tax software companies.” Free tax preparation and e-filing is available if your adjusted gross income is $56,000 or less. You have two options with the Free File program, you can work with a company or you can fill out the paper forms and e-file for free. If you are unsure if you qualify, you can answer this short questionnaire [8] and they will match you with a company (to qualify for free tax prep, you have to visit their website through the IRS Free File links). I entered in some data as a Maryland resident and the only company I recognized was TaxAct [9].

This program only gives you free federal income tax preparation and e-filing, companies will try to up-sell you on state tax preparation products. You may want to buy those products because it’s easy but be sure to check if your state offers free tax prep or e-filing services. For example, you can e-file Maryland state income taxes absolutely free (and, as always, you can mail in your return for free).

Simple Tax Situations Resources

If your income disqualifies you for the low income resource, plenty of companies will give you free tax preparation software if you have a simple tax situation. Each company defines “simple” differently but if you would otherwise fill out a 1040EZ and take the standard deduction, you probably qualify as “simple.” As with the free filing resources for low income earners, companies are banking on two things by giving you free tax prep:

  • State Tax Preparation Up-sell: They will try to sell you on their state tax preparation software and it might be a good choice just to save time, especially since they can export all your data. However, remember to check your state to see if you can e-file for free (you can always mail in your return for free).
  • Future Tax Preparation: There are probably marketing statistics that say a customer who signs on for the freebie this year will probably return next year, when they might not qualify for the free version anymore. I know that’s what happened to me. For two years I filed my returns at TurboTax for free, in the third year I happily paid because I was familiar with the system and comfortable with them.

TurboTax

TurboTax [10] offers a Free Edition that includes e-filing, though state costs $25.95 per state with free e-filing. TurboTax lists which forms and schedules are included in the Federal Free edition [11]. As you can see, it includes most of the major forms (including Schedule A, so you can itemize deductions and still qualify for free filing).

TaxAct

TaxAct [9] offers their TaxACT Standard product for free with free printing and free e-file. If you want to file your state return, it’s only an extra $13.95 and that includes e-filing as well. TaxAct supports 1040, 1040A and 1040EZ forms so it also covers many of the major standard forms (list of forms [12]). Having never used TaxAct, I can’t compare its features versus TurboTax (though many readers have sung TaxAct’s praises) but if you’re filing federal and state together, TaxAct is cheaper because state costs only $13.95 versus TurboTax’s $25.95.

TaxCut

One thing that surprises me is that H&R Block doesn’t offer a free version of TaxCut [13], you would think they want to compete with TurboTax and TaxAct but they don’t offer a single free version of their tax preparation package.

Upon further review, it turns out that H&R Block [14] does have a free version of TaxCut [13] but you have to go directly to the H&R Block website and not the TaxCut website! (or if go to this page about the free version [15]) It’s for “a simple return excludes self-employment income (Schedule C), rental and royalty income (Schedule E), farm income (Schedule F) and shareholder/partnership income or loss (Schedule K-1).” At the bottom there is a tab labeled “Forms,” review that for the included forms.

I believe that covers all the free resources out there, if I missed one, please share them in the comments and I’ll be sure to include it!

(Photo: blmurch [16])


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URLs in this post:

[1] Tweet: http://twitter.com/share

[2] Email: mailto:?subject=http://www.bargaineering.com/articles/free-tax-filing-resources.html

[3] IRS’s search tool to find e-file Providers: http://www.irs.gov/efile/article/0,,id=118449,00.html

[4] find them using this map: http://www.irs.gov/localcontacts/index.html

[5] the program: http://www.irs.gov/individuals/article/0,,id=107626,00.html

[6] AARP’s Tax-Aide site: http://www.aarp.org/money/taxaide/

[7] Free File program: http://www.irs.gov/efile/article/0,,id=118986,00.html

[8] short questionnaire: http://www.irs.gov/app/freeFile/jsp/wizard.jsp

[9] TaxAct: http://www.bargaineering.com/articles/r/taxact.php?tag=freeTaxFiling

[10] TurboTax: http://www.bargaineering.com/articles/r/turbotax.php?tag=freeTaxFiling

[11] forms and schedules are included in the Federal Free edition: http://turbotax.intuit.com/personal-taxes/forms-free-edition_thickbox.jsp?TB_iframe=true

[12] list of forms: http://www.taxact.com/products/all_forms.asp?s=OLSTD

[13] TaxCut: http://www.bargaineering.com/articles/r/taxcut.php?tag=freeTaxFiling

[14] H&R Block: http://www.hrblock.com/index.html

[15] this page about the free version: http://www.hrblock.com/taxes/products/product.jsp?productId=201

[16] blmurch : http://www.flickr.com/photos/blmurch/448878029/sizes/s/

Thank you for reading!