McLEAN, Va. (1/26/09)--The fastest way to get your tax refund is still with electronic filing, but this year--for the first time--you have two options to file free, and one of them does not have an income constraint (USA Today
Jan. 20). Nearly 90 million taxpayers--58% of all returns--used e-file for their 2007 returns, according to the Internal Revenue Service (IRS) (irs.gov
). By e-filing and using direct deposit, you could have your money in eight to 10 days, as opposed to four to six weeks when filing a paper return. While some software can cost more than $80, there are ways to file electronically for free, if you know where to look:
* IRS Free File. This free federal tax preparation and electronic filing option is for taxpayers with adjusted gross income of $56,000 or less in 2008. There are varying Free File options, each carrying its own eligibility requirements: Some have age restrictions, apply only to certain states, or have an income cap lower than $56,000. Free File at irs.gov helps you choose a program. Note that some include free state tax preparation, while others carry a fee. If you don’t qualify for one of the Free File programs that include a free state return, 26 states offer their own free e-file option. Check your state’s offerings at taxadmin.org/fta/edi/etalinks.html. * IRS Free File Fillable forms. New this year, this option opens up Free File to all taxpayers--even those with incomes exceeding $56,000. In contrast to the full-service Free File option, Free File Fillable Forms is more of a “self-service” option. Taxpayers self-prepare and file IRS forms electronically, similar to paper filing, but the program performs the basic calculations. For example, the program won’t tell you whether to itemize or take the standard deduction, but it will crunch the numbers once you enter them. Fillable Forms does not support state forms or State e-file.
For tax information, including how to use Fillable-forms and all available Free File offerings, visit irs.gov
. For more information, read “Year-End Tax Planning With Some Twists” and “Don’t Miss Out on Tax Breaks” in Home & Family Finance Resource Center