70% of Americans can file taxes free
If your income is $58,000 or less, you can file free with tax software or at the IRS site.
If your adjusted gross income for 2010 is $58,000 or less, you can prepare and file your taxes at no cost at Free File.
This partnership between the IRS and tax software manufacturers who are members of the Free File Alliance kicked off its ninth year last week.
During the formal announcement of Free File 2011, IRS senior executive David Williams, had some advice for all e-filers:
Submit your tax returns as soon as you can.
Despite the tax processing problems caused by the end-of-year passage of the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010, Williams said it's better not to wait. Just e-file your 1040 when you're ready and let your software worry about when the IRS can deal with the return.
"There's no need to wait to file," Williams said during a Friday afternoon telephone press conference. "If you're ready to file, go ahead and file and the tax software industry is prepared to essentially stockpile these returns and then send them when we're ready to accept them."
And note that the $58,000 income threshold applies to all filing statuses.
If you're in the other 30% of taxpayers, you can give the IRS' fillable forms a look.
These documents allow filers who are comfortable with what goes on their returns to open up the online forms, complete them right there on the computer screen and then e-file for free, too.
The fillable forms don't offer the step-by-step walk-through that's part of commercial tax prep software. But the forms do carry data from associated schedules to the 1040 and do basic math, said Williams, thereby reducing some of the more common filing errors.
Of course, some folks won't be able to go electronic this year. If you claim the first-time homebuyer credit, for example, you'll have to send in an old fashioned return that includes acceptable documentation of your home purchase.
But if you can e-file, regardless of whether you use Free File, fillable forms or buy tax software, do so. If your return is one that can be processed immediately by the IRS, e-filing it and choosing direct deposit of your refund could get the money in your account in 10 days or less.
- E-file and Free File are open (Bankrate Taxes Blog)
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