You can probably guess that I tend to recommend finding a competent, reliable tax professional to help you out come tax time. I’m not too proud to say that I don’t do my own taxes anymore, not because I enjoy paying someone else to do them but because I want to stay married.
Let’s face it. Taxes can be stressful for some taxpayers and anything that you can do to make it easier on yourself, the better.
That said, some folks may not have the means to pay a preparer. Or maybe you’re just a masochist and want to do your own taxes for fun (it happens). Free (or low cost) tax preparation services and software are available, you just have to find them. Follows are some resources that might be helpful:
- IRS Free File. The IRS wants you to use Free File. I know this because they send me a lot of emails telling me so. They also shout at taxpayers on their web site: EVERYONE is Eligible to Free File! Since it’s in all caps, you know they’re serious. There are two versions of Free File: one, a free, federal income tax prep and electronic filing program for eligible taxpayers and the other, Free File Fillable Forms (see more below).
- The Free File program that you and I tend to think of is the free, federal income tax prep and electronic filing program developed through a partnership between the IRS and the Free File Alliance, a group of private-sector tax software companies. With the program, eligible taxpayers can do their federal income tax returns using commercial online software available through IRS.gov. Eligible taxpayers mean those that have Adjusted Gross Income (AGI) of $57,000 or less; believe it or not, the IRS says that encompasses 70% of taxpayers. Other limits may also apply; you can use the Free File online tool to find a company that’s best suited to you.
- If your AGI is more than $57,000, the IRS offers Free File Fillable Forms – try saying that three times quickly. Free File Fillable Forms is a simple electronic equivalent of paper forms. The software performs some basic math and field error checking but that’s it. It does not walk you through your tax return in an “interview” fashion like many retail software packages. This means that you have to have a certain level of comfort with your tax returns in order to use the software.
- IRS VITA. I’m a big fan of VITA or the IRS Volunteer Income Tax Assistance Program. This is in-person tax preparation for low to moderate-income taxpayers at centers around the country. That tends to mean taxpayers with AGI of $50,000 or less. Federal tax returns are prepared by trained volunteers; I can vouch for the training as I worked for years with great folks at a local VITA site. To locate a VITA site, call 1.800.906.9887 or find a site online.
- IRS TCE. The IRS offers free preparation for those ages 60 and above through its Tax Counseling for the Elderly (TCE). Like the VITA program, TCE centers are staffed with volunteers. As part of the program, the AARP offers Tax-Aide counseling program at more than 7,000 sites nationwide during the filing season. To find a Tax-Aide site, call 1.888.227.7669 or check out the AARP’s website.
- AFTC Help. The Armed Forces Tax Council consists of tax program coordinators for the Marine Corps, Air Force, Army, Navy, and Coast Guard. At tax time, volunteers work with sailors (Go Navy!), soldiers, marines, airmen, and guardsmen and their families to provide free tax preparation help at offices within their installations. Specifically, these sites – through the VITA program – are trained and equipped to address military-specific tax issues, such as combat zone tax benefits and those pesky new Earned Income Tax Credit guidelines.
- Commercial/retail software packages. Most of the popular software packages, like TurboTax, CompleteTax, H&R Block, Tax Slayer, TaxACT, and Jackson-Hewitt, offer a free bare-bones tax preparation option. In most cases, this means a basic return (like a 1040-EZ) or a limited form 1040. Extras – like exile and state returns – may cost you. As with anything, read the fine print to make sure you know what you’re getting.
- Churches, law firms, and generally good guys and gals. Not all free tax preparation sites are IRS-sponsored. Sometimes, the private sector offers free tax services. Check your local newspaper, radio, and TV to see if there are any free tax prep services offered near you. But be smart. If a tax prep service pops up overnight, ask questions before you hand over your financial information.
- Cool tax blogs. *clears throat* Like I’m not going to remind you about my contest? I still have free tax software through CCH to give away… Don’t miss your chance!
So you have lots of options. But before you log off the computer and sprint away to get your taxes done, listen to a few more pieces of information.
First, free can be good. I like free. But free isn’t always free and free isn’t always better.
Ask questions and check out any service or provider that you’re considering to find out whether there are any hidden fees or caveats. Be wary of add-ons or other extras that can jack up the cost from free to well, not free.
Don’t respond to solicitations for free tax prep services online or over the phone: it could be a scam. And by could be, I mean probably. Don’t reply to emails or click on links from random companies. Don’t give out personal or financial information via email purporting to be from IRS (they won’t ask via email) or a company with which you didn’t initiate contact.
Make sure you have a level of comfort with both the level of competence and trustworthiness of the preparer: if something doesn’t feel right, trust your gut. You’re not obligated to use anyone’s services and it’s completely okay to get up and leave. Those same rules from before about tax preparers – they still apply here. That said, if you don’t feel that you’re getting good service, take a deep breath. Please remember that most of these folks are volunteers and they’re trying to do a nice thing, so mind your manners. There’s no need to be snippy or rude – you know your mother taught you better. And say thank you.
There’s a lot of help out there. You just need to know where to look – and now you do!