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As the tax filing deadline approaches, you may be worried about the cost of tax preparation or wondering which software to use. But before you drop off your paperwork or pay for software, you should look to see if you're eligible for free tax preparation and filing. Availability of free options may be based on your income, age or profession, but most taxpayers can qualify for either free software and e-filing.
DIY with Free Tax Software
If you're comfortable preparing your taxes on your own, professional tax software may be available at no cost.
IRS Free File
The IRS Free File Program is a partnership between the IRS and tax software companies. As part of the program, companies make free versions of their software available to taxpayers who meet certain requirements. About 70% of U.S. taxpayers qualify for IRS Free File.
- For the 2020 tax year, you can qualify if your adjusted gross income (AGI) is under $72,001.
- There are many options available from popular tax software companies, including TurboTax, TaxAct and TaxSlayer.
- The Free File versions support tax situations that may otherwise require a higher-tier (and more expensive) software version. This includes support for many gig workers, freelancers and self-employed taxpayers who need to file a Schedule C form.
- Some Free File options have additional restrictions (such as a lower income cutoff for free services) or don't offer support for taxpayers in every state. You can use the IRS' Free File Online Lookup Tool to get matched with the options that may work best for you.
The same income limits apply regardless of your tax filing status. However, your gross (pretax) income for the year will likely be higher than your AGI, which subtracts deductions and adjustments.
If your AGI is over $72,000, IRS Free File also offers fillable forms you can use. However, the forms don't provide guidance and only do basic calculations.
The Department of Defense offers free tax software to military members, their immediate family members and eligible survivors. The software is also available to retired and honorably discharged service members for up to 365 days after their date of retirement or separation.
You can access the software through your Military OneSource account, and prepare and file your tax return on your own.
If you need assistance, you can get support from MilTax consultants online or over the phone. IRS-certified volunteers also receive military-specific training through the Volunteer Income Tax Assistance (VITA) program and offer in-person or virtual support.
Additional Free Software Options
There may also be free software options that aren't part of the IRS Free File program. For example, H&R Block, which no longer participates in IRS Free File, has a free version for taxpayers with simple returns.
Some companies that are part of the Free File Alliance also offer different multiple free versions of their software, which can be confusing. Look closely to see the eligibility requirements, supported forms and fees for e-filing state tax returns. Use the IRS Free File website to navigate to free tax preparation services, as some companies have been known to push customers toward other services that don't have the same benefits as what's offered through IRS Free File.
For instance, TurboTax offers a Free File edition that self-employed taxpayers can use. But it also has a separate Free Edition which doesn't support self-employed taxpayers. If you start with the Free Edition, you may be prompted to upgrade to a paid version of the software in order to complete and file your return.
Have Someone Else Prepare and File Your Taxes for Free
If you don't feel comfortable preparing your own tax return or don't qualify for one of the free software options, you may be able to get assistance from trained volunteer tax preparers.
Volunteer Income Tax Assistance and Tax Counseling for the Elderly
The IRS manages two programs that offer free tax help: Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE).
- Free tax help is available to taxpayers with disabilities, seniors and those with limited English fluency.
- Generally, assistance is available to low- and moderate-income households. VITA services are available to all taxpayers who have an income of $57,000 or less, but some programs may have higher income caps.
- IRS-certified volunteers can help prepare and e-file your federal and state tax returns for free.
- Your tax return will be reviewed by a second IRS-trained volunteer before it's e-filed.
The IRS maintains a list of local VITA and TCE sites online. Older taxpayers may want to look for a TCE site, where volunteers have received special training to handle pensions, retirement income and other common retirement-related tax situations. Many of these sites are also part of the AARP Foundation's Tax Aide program (AARP membership isn't required).
Check online or call your local tax preparation sites to find out how the process works during the pandemic. You may need to make an appointment and drop off your forms, and some sites are offering in-person tax preparation.
If you prefer a semi-assisted approach, you may also be able to sign up to prepare your own tax return while volunteers are available to offer guidance and answer questions. This option may be available in person or online.
When to Hire a Tax Professional
Free tax software or assistance is available to most taxpayers, but it isn't an option for everyone. Even if you're under the income limit, you might not qualify if you have a complicated tax situation—such as a requirement to use the alternative minimum tax. Or, if you have lots of questions and want personalized advice, hiring a tax professional might make sense.