Looking for a way to reduce the cost of income tax
preparation this year? Then you came to the right place --
maybe!
The IRS has launched a new program this year -- it's called
"Free File", and it enables you to prepare and e-file your
personal income tax return online for free.
But, alas, there is no free lunch and likewise this
"free" program isn't really free for everyone. You have
to meet certain eligibility requirements to take advantage
of Free File, so read on!
Simply put, Free File is a new government program that
enables certain qualifying individuals to both prepare
and e-file their income tax returns for free -- online.
The IRS has entered into a partnership with 17 private
tax software companies who each offer their services to
the public at no cost.
But here's the catch: not everyone qualifies, and each
of the 17 software companies has different eligibility
requirements.
Generally speaking, lower income people qualify, as
do people of certain ages and those who live in certain
states.
(Gee, sounds confusing, doesn't it? Guess that's why
it's a government program.)
There are 3 main requirements. You only have to
meet one of these criteria to qualify:
1. Income -- if your income is below the following
amounts, you qualify. Take note: there are several
different qualifying amounts, depending on the
software vendor.
TurboTax -- $27,000
FreeTaxReturns.com -- $28,000
H&R Block -- $28,000
TaxBrain -- $12,000
CompleteTax -- $33,000
Efile-Tax-Returns.com -- $28,000
FreeTaxUSA.com -- $30,000
TAXSLAYER.COM -- $30,000
TAX$IMPLE -- $28,000
Free1040TaxReturns.com -- $25,000
ezTaxReturn.com -- $40,000
TaxEngine -- $9,200
Only one vendor allows you to qualify if your income
is above a certain amount. TaxACT.com is free if your
income is greater than $50,000.
2. Age -- if you are above or below a certain age,
you qualify.
TaxBrain -- age 50 or older
OnLineTaxes -- age 20 or younger
3. State of residence -- if you happen to live in
one of the following states, you qualify.
FileYourTaxes.com -- Arizona, Georgia, Michigan
or Wisconsin
eSmartTax.com -- Illinois, N. Carolina, Ohio or
Georgia
And there's one more: TAXSLAYER.COM lets all
Active Duty Military personnel file for free.
Here's a few points to keep in mind.
First, you still have to prepare the return
yourself, and you have to do it online at the website
of each software company. So, the point here is
obvious: Free File is a viable option for
do-it-yourself-ers only.
If you're not inclined to prepare your return
yourself, Free File is not for you.
Second, you must use the vendors web-based
tax preparation software and you also must e-file right
from the vendor's website. Maybe you've been using
one particular software for awhile -- your software
company may not even be in this program, so you'll
have to learn a new program, which may not be worth
the extra time.
Third, and most importantly -- all this hype about
Free File is really a mute point if you don't qualify.
And most middle-class and upper-class folk don't
qualify.
If you make more than $50,000 and happen to like
TaxACT.com, you're in business. Or if you happen to live
in one of 7 states, you're also in luck.
Otherwise, this program is probably more for your
children than for you.
To get all the details, go to the IRS website at
http://www.irs.gov and click on "Free Online Filing --
Are You Eligible". You'll find complete information
on the program, including links to all 17 vendors,
and a Frequently Asked Questions page. Enjoy!
About the Author
Wayne M. Davies is author of the new eBook, "The Tax
Reduction Toolkit: 29 Little-Known Legal Loopholes That Will
Reduce Your Taxes By Thousands (For Small Business Owners
and Self-Employed People Only!) Don't file another tax
return until you visit:
http://www.YouSaveOnTaxes.com/toolkit.html
