Many of the no-cost online services have age or income limits. But some are available to anyone.
It’s tax-filing season, and whether you go to an accountant or use online tax software, filing a return can be expensive. But there are free options.
The typical fee for preparing a basic Form 1040 is $220, according to the National Society of Accountants, a membership group representing tax professionals in small and medium-size firms. But costs vary by region. You’ll usually pay more on the coasts.
For many low- and moderate-income filers, that’s a steep price that eats into their tax refunds. And many filers use that refund to make important purchases or pay down debt. The average federal refund is about $2,800, according to the Internal Revenue Service. And more than half of filers earning less than $30,000 a year seek professional tax preparation help.
Fortunately, there are free options to help people prepare and file their tax returns. Many have age or income limits, but some are available to anyone.
“The tax codes are complicated,” said Lisa Marsh Ryerson, president of AARP Foundation, the charitable arm of the advocacy group for older Americans AARP. The foundation runs volunteer tax preparation sites focused on people 50 and older and those with low or moderate incomes through its Tax-Aide program.
“Far too many people pay too much to have their taxes prepared, or are missing out on refunds and credits,” she said.
This year, Ms. Marsh Ryerson said, it’s important that older filers know that the earned-income tax credit, which can reduce your tax bill or increase your refund, was temporarily expanded. The credit mainly helps working families with children, but the maximum age limit of 64 was eliminated for 2021, so older workers can claim the credit when they file their return this year. The maximum credit for filers without qualifying children nearly tripled for 2021, to $1,502. The amount of the credit is based on income, family size and filing status. A single filer without children and earned income up to $21,430 is eligible for the credit.
Last year, many Tax-Aide sites were shut because of the coronavirus pandemic, but 3,500 sites are open for this year’s tax season, Ms. Marsh Ryerson said. “We are up and operational.”
Filers can get help in person, online or with a combination of each, she said. Appointments are required, and you can find information about locations online or by calling 888-227-7669. (You don’t have to be an AARP member to get help.)
The I.R.S. supports two programs that offer free tax help to underserved groups. One is the Volunteer Income Tax Assistance program, or VITA, which generally helps people with income of $58,000 or less, as well as people with disabilities and those who speak limited English. The program works with local community groups, which staff offices during tax season with volunteers trained by the I.R.S. You can use the I.R.S. locator tool to find a site near you. Many require that you make an appointment. (You can also go to GetYourRefund.org, a VITA partner that helps families with somewhat higher incomes — up to $66,000.)
The second is the Tax Counseling for the Elderly program, which generally offers free tax help to people 60 and older. The program specializes in tax matters unique to older people, like pensions and retirement-related issues. (Many of the sites are operated by the AARP Foundation Tax-Aide.)
MilTax, a program of the Defense Department, offers free tax preparation and help to service members and their families. The program includes tax software that addresses questions specific to the military, like deployments and combat and training pay.
The I.R.S. Free File program offers no-cost online tax programs to people who earn $73,000 or less. The program began in 2003 as a way to offer do-it-yourself tax software to the public, through a pact between the I.R.S. and the Free File Alliance, a collection of commercial vendors.
But the program was not widely used, in part because the I.R.S. lacked money to promote it. While 70 percent of filers were eligible to use it, just 2.4 percent did, according to a federal review. H&R Block dropped out of the federal program in 2020, and last year Intuit, which makes the popular TurboTax program, said it was leaving as well. In its regulatory filings, Intuit said it had left because the Free File agreement was changed in 2019 to “eliminate the pledge by the I.R.S.” that the agency wouldn’t offer a competing service.
Still, eight software providers are participating this year, including TaxAct and TaxSlayer. “These companies have a good product,” said Tim Hugo, executive director of the Free File alliance. Some states offer free state tax returns through FreeFile as well.
Surveys have found that a vast majority of users are happy with Free File, Mr. Hugo said. “People like the product,” he said. “We just need more people to know about it.”
The I.R.S. said in an emailed statement that it had received 596,000 tax returns through Free File as of Feb. 11 and that it expected “hundreds of thousands” more this year.
Filers can also seek free, in-person help by appointment from the I.R.S. at its Taxpayer Assistance Centers. The I.R.S. is offering special hours for walk-ins in many states. The centers will be open one Saturday a month during tax season, with no appointment needed. The next scheduled Saturday is March 12. Check the agency’s website for details.
It’s still possible to file a paper return, but because of processing backlogs from the pandemic, your refund may be significantly delayed. “If you need a tax refund quickly, do not file on paper,” the I.R.S. advises.
Here are some questions and answers about free tax help and the 2022 filing season:
Is there a free filing option for people with higher incomes?
Anyone, regardless of income, can use the I.R.S.’s Free Fillable Forms to complete and file a federal return electronically, without extra guidance. The forms are a good choice if you are confident in handling your taxes on your own.
Do commercial software programs offer their own free filing options?
Some promote free options for basic returns. Wirecutter, the product-review affiliate of The New York Times, tested six do-it-yourself online tax programs and deemed TurboTax Free Edition the top pick overall. People who have a simple return but are reporting student loan interest or college tuition, the review found, may want to try H&R Block Free Online.
The free versions generally don’t include professional advice, so you’ll have to pay for an upgrade if you want extra help.
How can I check the status of my tax refund?
