As W-2s begin arriving in mailboxes around the country, American consumers' thoughts turn to taxes. It's no wonder. It's estimated that taxpayers spend more than 3.5 billion hours and almost $30 billion annually to comply with Uncle Sam.
But today, there are more free tax preparation options available than ever before, significantly reducing the burden on U.S. taxpayers. Free tax preparation is available for millions of taxpayers, including low and middle-income filers, those on active military duty and those who file simple tax returns, like a 1040EZ.
Through the IRS Free File Program, 70 percent of all taxpayers -- about 95 million people -- can get free online tax preparation and e-filing. The Free File program is a public-private partnership between the federal government and about 20 private tax preparation companies. People with an adjusted gross income (AGI) of $58,000 or less can select from more than a dozen online tax preparation services.
Additionally, anyone, regardless of their income, can use the Free File Fillable Forms at www.irs.gov. It's a free, simple forms utility that's basically the electronic equivalent of a paper 1040 along with associated schedules and forms.
Intuit has supported this program for nearly a decade. In that time, the company has donated more than 22 million federal and state tax returns to low and middle-income taxpayers. For tax year 2010, anyone who qualifies for the Earned Income Tax Credit, or is on active duty military with an AGI of $58,000 or less, or has an AGI of $31,000 or less can use TurboTax Online Tax Freedom Edition through the Free File program. Additionally, through the IRS web site, TurboTax offers free state tax preparation to qualified taxpayers who file returns in 21 states: Alabama, Arizona, Arkansas, Georgia, Idaho, Iowa, Kentucky, Michigan, Minnesota, Mississippi, Missouri, New York, North Carolina, North Dakota, Oklahoma, Oregon, Rhode Island, South Carolina, Vermont, Virginia and West Virginia.
Many commercial tax software providers also offer free federal tax preparation and e-filing to those with simple returns through their web sites. This is a smart option for people with simpler returns who can save money by doing their own taxes. In fact, last year, taxpayers who filed a 1040A or 1040 EZ paid an estimated $2.5 billion in preparer fees. These taxpayers could have easily and accurately done their taxes themselves with software for a fraction of the cost, saving an estimated $1.5 billion.
With all these options available, don't wait. See if you're eligible for free tax filing at www.taxfreedom.com. Take advantage of the many ways that filing your taxes can be easy -- and maybe free.
As vice president for consumer advocacy for Intuit's TurboTax business, Bob Meighan works with customers to help ensure TurboTax products meet their needs. A Certified Public Accountant, Meighan holds a bachelor's degree in business administration from the University of North Carolina.