How to file my taxes online for free

Most Americans should be able to file their federal taxes online for free, but very few do. Scott Simon speaks with ProPublica reporter Justin Elliott about this.

SCOTT SIMON, HOST:

Here's a tax tip with the filing deadline less than a month away. If your adjusted household income is less than $73,000, you don't have to pay to file to the IRS, but only a tiny percentage of those eligible for free filing actually take advantage of it. Why? Justin Elliott, a reporter with ProPublica, has been reporting on this issue for nine years now. Mr. Elliott, thanks for being with us.

JUSTIN ELLIOTT: Good to be here.

SIMON: And why do so few people take advantage of this option for free filing? Is there any one answer?

ELLIOTT: Well, I would say the biggest factor is confusion between the sort of truly free IRS-sponsored option and then a bunch of commercial options that are advertised as free but are not always free. So it becomes very confusing very quickly.

SIMON: Well, explain that to us. Are you referring to people that are using a tax prep service or software?

ELLIOTT: I am. So there's a lot of offers from companies like TurboTax and H&R BLOCK that are labeled as free that are sometimes free but sometimes sort of put users on an off ramp into paying a fee. The IRS has this program called Free File that if you manage to find it, which very few people do, you will actually get a free return if you make under the $73,000. So if you just Google IRS Free File, and make sure to click on the dot-gov site and try to ignore all the ads for other services labeled as free - as long as you start from the IRS site, you should get that free federal return.

SIMON: What's kept you on this story for nine years? I think Woodward and Bernstein were done in just three or four.

ELLIOTT: (Laughter) Right, a couple things. One is it affects so many people. I get tons of calls and emails every year. But also, I mean, I think it's an interesting story of privatization of government services and how that's played out over time. I mean, the history here is 20 years ago during the George W. Bush administration, the IRS was actually considering offering its own official tax prep service. And the private tax prep industry didn't want that to happen. And we ended up with this sort of strange hybrid system that we're living in today.

SIMON: Some of ProPublica's coverage mentions that in other countries, people actually don't file taxes at all. The government essentially does that for them. Why doesn't that happen in the U.S.?

ELLIOTT: So in a lot of other developed countries, you essentially get a tax return that's already been filled out by the tax agency, and you sort of just look it over and click submit. One of the reasons that doesn't happen here is the influence and lobbying of the for-profit tax prep industries. And there's been really decades of lobbying by that industry to ensure that the IRS doesn't take a sort of more robust role in helping people file their taxes.

SIMON: Yeah. What's the argument that the tax preparation companies make? I mean, is it essentially - why should you trust the government to figure out your taxes?

ELLIOTT: That's one of the core arguments. You know, the IRS obviously has an interest in collecting as much money as possible. So why would you trust them to sort of prepare your taxes? But the companies also point out people are sort of voting with their feet and they appear to like using these products. So we've heard from a lot of Americans who have just never heard of the IRS Free File option and have been paying TurboTax or H&R BLOCK for years and years when they could have been getting basically the same product for free if they had simply known about the IRS option. So there's definitely a population of people like that as well.

SIMON: Justin Elliott, a reporter of ProPublica, thanks so much.

ELLIOTT: Thank you.

[POST-BROADCAST CLARIFICATION: In this story, and in a previous headline, we suggest that free filing is limited to those making less than $73,000. This story focuses on the IRS Free File program for those in that tax bracket.

Editorial Note: We earn a commission from partner links on Forbes Advisor. Commissions do not affect our editors' opinions or evaluations.

There are many different ways to file your taxes for free, but these options are typically reserved for folks under certain income thresholds or simpler tax returns.

Compare the best tax software of 2022

If you meet certain requirements, you can file your taxes for free using online software programs, or receive direct help from tax professionals who volunteer through a program sponsored by the IRS.

“These free services are also beneficial to taxpayers in that they can offer significant cost savings. Many taxpayers with relatively simple returns often pay hundreds of dollars to file their taxes through national tax preparation companies,” says Nell Curtis, an accounting instructor at Milwaukee Area Technical College in Wisconsin.

Here’s a look at the various options and which one may fit your financial situation the best.

1. Free Versions of Online Tax Software

Many of the big tax preparation companies will bring in customers with the offer of “free” filing, says Curtis. But beware of the upsell.

We at Forbes Advisor reviewed four of the top online tax software platforms, and our top free pick for simple tax returns is Cash App Taxes where you can file both your federal and state taxes for free. The service includes several forms, including self-employment, as part of their free package.

Unlike Cash App Taxes, some online tax software providers offer limited form options. “Often, if the return requires any additional forms like a Schedule A or C, that costs extra. In many cases the federal return might be free, but a state return will have an additional cost.”

When you’re choosing a free product, read the fine print. Most of these products come with limitations that may exclude your specific situation, including your income and the forms you need to file. Also, consider the complexity of your taxes: If you think you’ll need professional help while filing, some tax software companies offer CPA assistance—but you’ll likely have to pay for it.

Read more: The Best Tax Software of 2022

2. IRS Free File

The IRS Free File program provides free tax filing from many online tax software companies to Americans with an adjusted gross income (AGI) of $73,000 or less in 2021, including TaxAct and TaxSlayer. If you earn more, you can use a different online program called the Free File Fillable Forms. If you need an automatic extension to file, you can do that online also.

“The IRS Free File program connects taxpayers who qualify to vetted online tax preparation services and is an option that many people overlook,” Curtis says.

The advantage of Free File is that the experience is similar or nearly the same as you would get using TaxSlayer’s advertised free filing product because the software programs were created by these large tax filing companies. But in most cases, you can file more forms for free using the IRS Free File site compared to using the online tax software product directly.

“Someone with relatively simple taxes who meets the requirements should seriously consider the Free File program,” Curtis adds.

To successfully use Free Fillable Forms, you’ll need to familiarize yourself with paper forms and do basic tax calculations with limited guidance. It’s also for federal taxes only; you can’t file state taxes through this program.

Read more: 12 Common Tax Myths, Busted

3. VITA

The IRS has a Volunteer Income Tax Assistance (VITA) program, with partnerships all over the U.S., that provides free tax preparation for people who qualify. The VITA program offers free tax help for individuals who generally make $58,000 or less, people with disabilities and limited English-speaking taxpayers.

VITA volunteers must pass certification exams  to participate. Every return must go through a quality review process before it is filed, Curtis says.

“This can be a good option for someone who isn’t comfortable doing their own taxes but still wants to take advantage of a free filing program,” Curtis adds, who is the site coordinator for Milwaukee Area Technical College’s VITA program.

You should prepare for your appointment beforehand. Here’s a list of items you should bring to your VITA appointment. Along with these items, taxpayers also need to provide photo IDs and social security cards/taxpayer identification number (TIN) letters to prove their identities.

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