IRS Free File opens in January
of ConsumerAffairsWith the beginningof income tax filing season just weeks away, the IRS says millions of taxpayers will qualify for the IRSs Free File, which as the name implies, is free.
For taxpayers who have used, and paid for commercial tax-filing software, the procedure should be very familiar. You answer questions about your income and deductions and the software fills out the tax forms. The service is for people whose adjusted gross income is $79,000 or less. That includes a huge segment of the population.
Adjusted gross income, also known as AGI, is defined as total income minus deductions, or "adjustments" to income that you are eligible to take.
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Gross income includes wages, dividends, capital gains, business and retirement income as well as all other forms income.
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Examples of income include tips, rents, interest, stock dividends, etc
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Adjustments to income are deductions that reduce total income to arrive at AGI.
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Examples of adjustments include half of the self-employment taxes you pay; self-employed health insurance premiums; contributions to certain retirement accounts (such as a traditional IRA); student loan interest paid; educator expenses, etc.
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You can find your previous AGI on your 2022 federal tax return to use as a guide. Take a look at Line 11 if you filed a Form 1040.
Two ways to file
The IRS Free File Program is a public-private partnership between the IRS and many tax preparation and filing software industry companies that provide their online tax preparation and filing for free. It provides two ways for taxpayers to prepare and file their federal income tax online for free:
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Guided Tax Software provides free online tax preparation and filing at an IRS partner site. These companies deliver this service at no cost to qualifying taxpayers. Again, taxpayers whose AGI is $79,000 or less qualify for a free federal tax return.
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Free File Fillable Forms are electronic federal tax forms, equivalent to a paper 1040 form. You should know how to prepare your own tax return using form instructions and IRS publications if needed. It provides a free option to taxpayers whose income (AGI) is greater than $79,000.
Make sure you start the process on the IRS website. Going to a commercial software companys website will not provide access to Free File.
Currently, the official Free File site is closed, but will reopen in early 2025 when the IRS is ready to receive 2024 federal tax returns.
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Posted: 2024-12-16 01:41:50
