How to File Your Tax Returns for Free
You would think filing your tax return should be free.
After all, you’re paying the government money.
However, filing taxes feels complicated to many Americans.
In order to minimize the complexity, several companies have developed software to help you fill out your tax return.
In many cases, that software costs money.
Thankfully, you can learn how to file tax returns for free if you’re willing to be flexible or put in the effort.
Here are a handful of filing options you may have depending on the tax situations you face.
IRS Free File
IRS Free File is a program run by the IRS that allows you to file your federal income tax return for free.
For people with an adjusted gross income of $72,000 or less, the IRS works with partners.
In January 2022, the IRS released a list of partners that allow you to file your tax return for free.
This is only guaranteed to be free for your federal income tax return.
Some providers may include a free state tax return, too.
Unfortunately, these partner offers aren’t available for people with an adjusted gross income above $72,000.
The IRS still offers a free option. You can fill out the tax forms online yourself.
In order to do this, you must know how to prepare your tax return.
Once the return is complete, you can e-file it yourself.
This IRS Free File option only applies to your federal tax return.
IRS Free File only works with your current year’s tax return and typically becomes available in January.
Self Prepare and File Your Tax Return by Mail (Postage Cost)
Another way you can prepare and file your tax return for free is cumbersome.
You can print out the forms needed to file your tax return and fill them out by hand.
If you don’t have a printer, your local library may have the most commonly filed forms available for your to pick up.
Then, you can mail the return and any applicable payment to the address in the instructions.
The benefit of this method is your sensitive data isn’t put on a computer.
Know what you're doing
The downsides are numerous.
You can easily make math errors that result in incorrect returns.
Additionally, manually filling out tax forms takes a ton of time.
The IRS takes much longer to process paper-filed tax returns, too.
Mailing your tax return isn’t technically free, either.
You must include enough postage based on the weight of your package to the IRS, but the cost is usually minimal.
You can normally print and file state tax returns, as well.
This could help you avoid state tax return preparation fees.
Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE) Programs
The IRS coordinates two programs to help people get their taxes filed for free.
The first is VITA which has been in operation for 50 years.
This service is for any of the following groups:
- People who make $57,000 or less
- People with disabilities
- Limited English-speaking taxpayers
The second is TCE.
This program is for people age 60 and older.
Its primary focus is helping people file taxes with pensions and other retirement-related tax issues.
Volunteers for both of these programs must pass tax law training.
All returns prepared are also checked for quality.
Major Tax Preparation Software for Simple Returns
Online tax preparation companies, such as Turbo Tax and H&R Block, typically offer free-to-file options.
Here are the offerings two major brands are advertising in December 2022.
TurboTax offers a free simple federal and state tax return.
Their definition is as follows.
You must only file Form 1040 with no other forms.
This includes situations such as:
- W-2 income
- Limited interest and dividend income
- Claiming the standard deduction
- Earned Income Tax Credit (EITC)
- Child Tax Credit (CTC)
- Student loan interest deduction
As you’d guess, many popular options are not available in the free version.
Some examples include:
- Itemizing your deductions
- Reporting unemployment income
- Business or non-employee contractor income
- Investment sales
- Rental property reporting
- Information located on IRS Schedule 1, Schedule 2, and Schedule 3, which includes some credits, deductions, and income reporting
H&R Block also offers a free simple federal and state tax return.
Their definition varies from TurboTax’s.
This includes more situations than TurboTax allows for.
The company allows for easy W-2 importing from select payroll providers or importing by taking a picture of your W-2.
As with TurboTax, you can get the Earned Income Credit (EIC) and Child Tax Credit (CTC) with the free version.
You can also get the deductions for student tuition, payments, and loan interest.
Retirement income reporting is also included.
A Rare Star - FreeTaxUSA.com
FreeTaxUSA.com is one of the few tax preparation software companies that allow you to file your federal tax return for free.
Yes, it actually can be free no matter how complicated your tax situation is, within reason.
The key to filing your tax return for free with this company is turning down all upgrade offers.
Upgrading gives you access to live chat and priority support, but these aren’t necessary to file your return.
It also gives you access to amending your return and audit assistance.
These features are not required to file your return for free, either.
Other add-on services also exist, but they don’t give you an opportunity to claim a bigger refund.
They’re simply conveniences.
For this reason, FreeTaxUSA.com stands out as offering as close to a free filing experience for everyone that you can find.
That said, FreeTaxUSA.com does charge for state income tax return preparation.
What About State Tax Returns?
State tax returns may be a different story than federal tax returns.
As with federal tax returns, you can prepare, print and file your state tax return by hand for free in most cases (the cost of postage still applies).
VITA programs typically assist with state tax returns in addition to federal tax returns.
Some major tax preparers include a free state return with their free-level product.
Some examples include TurboTax and H&R Block.
Unfortunately, these software companies are extremely strict with defining a basic tax return situation.
Any deviation means your federal and state tax return will likely cost money to prepare and file.
FreeTaxUSA.com charges a fee for state tax returns.
It is usually more affordable than its competitors as long as you don’t qualify for the competitors’ free software versions.
When It Makes Sense to Seek Out a Professional
While free is great, it does make sense to seek out professional tax return preparation in some cases.
The more complex your tax situation is, the more support you should generally seek.
If you qualify for a free return, chances are your tax situation is relatively simple.
If you only earn income from a W-2 job, have some basic investments and itemize deductions, tax preparation software will likely require you to pay for it.
That should work just fine for most people in this situation.
Once you start dealing with complex issues you don’t understand, you may want to seek a tax preparer.
Local tax preparers can ask questions to help evaluate tax items you may be missing.
A Certified Public Accountant (CPA) may provide even more help than a national chain preparer.
This could include tax planning services to minimize the tax you owe.
This is opposed to someone simply preparing your return based on the information you provide.
Once you start dealing with rental properties and businesses, you may want to consider talking to a CPA if you haven’t already done so.
Get Started Early
If you’re looking for free tax preparation services, it’s best to get started early.
People who file their federal tax returns earlier usually get their tax refunds earlier.
As the tax deadline nears, tax software and local tax services that offer free preparation get busier, too.
By completing your tax return as soon as you have the available information, you can beat the rush.
Frequently Asked Questions (FAQs)
Can I write off tax preparation costs and fees on my tax return?
Personal tax preparation costs used to be deductible but, under current law, cannot be deducted.
They used to fall under the miscellaneous itemized deduction.
However, business tax preparation fees may qualify for a deduction under the business.
Can I file tax returns for prior tax years for free?
It’s more difficult to find free tax preparation for prior year returns.
You can print prior-year tax forms from the IRS website and mail in a tax return for the cost of postage.
Even so, IRS Free File does not support prior-year tax returns.
Most for-profit tax preparation services won’t let you file a previous year's tax return for free.
FreeTaxUSA will allow you to print and mail a prior year federal income tax return for free.
You do not get electronic filing which means processing your return will take longer.
While you get free federal returns, they charge fees for state returns.