Did you know that if you’re filing a federal 1040, 1040A, or 1040EZ return you can file for free online without income limitations? If you made $57,000 or less in Adjusted Gross Income, you can use a number of free-file programs who partner with the IRS in the Free File Alliance.

Free Federal Filing Software

If you made $57,000 or less in Adjusted Gross Income, you have a number of options to choose from. Some have age restrictions, as retirees face different tax challenges. Others have state limitations. The following three options work in any state, though they have different age and income rules.

TurboTax Federal Freedom Edition

The Turbo Tax Federal Freedom Edition is a free online version of the basic Turbo Tax software with less handholding. Unlike some other options, it appears to have no income limits or age restrictions (I will update this if more information comes along, but my research hasn’t shown income limits).

Like the other programs, this does not cover things such as self-employment income, investments, etc. As mentioned above, it also has less hand-holding, unlike more advanced versions which explain every question in detail. But is has one huge benfit. As you’ll see below, you can use the TurboTax version to e-file for free in some states too.

H&R Block’s Free File

H&R Block at Home (formerly known as Tax Cut) also offers a free version (with free file) of their normal software. You’re eligible to use their free federal online tax return preparation and e-file if your adjusted gross income is $57,000 or less and you are age 51 or younger. This federal offer is valid in all states.

Free TaxACT Federal

TaxACT also offers free online federal tax preparation and e-filing. Like TurboTax, it allows for free filing provided that you have a simple tax return. There do not appear to be income restrictions. This federal offer is valid in all states. Extensions e-filed for free.

E-File for Free When Your Adjusted Gross Income is OVER $57,000

Even if your AGI is over $57,000, you can still prepare and e-file certain federal forms for free Free File Fillable Forms. These forms aren’t like filling out forms in regular tax software. Instead, they’re like filling out paper forms, only you can save your information online and e-file.

It doesn’t have the prompts or the helpful explanations that tax software does, but it’s easier and cleaner than doing them by hand. Also, it’s free, so the worst thing that can happen when you give it a shot is that you decide you need to purchase tax software.

State Tax E-Filing

In most cases, when you do your federal taxes for free, you still have to pay in order to efile. For H&R Block at Home, it costs $29.95 per state. For TaxACT, it costs $14.95 per state. If you’re not eligible for the TurboTax free file, it costs $27.95 per state.

However, if you’re eligible to use TurboTax Federal Freedom, there are certain states in which you can prepare and e-file for free. The states for which this applies are up to three of the following:

  • Alabama
  • Arizona
  • Arkansas
  • Georgia
  • Idaho
  • Iowa
  • Kentucky
  • Michigan
  • Minnesota
  • Mississippi
  • Missouri
  • New York
  • North Carolina
  • North Dakota
  • Oklahoma
  • Oregon
  • Rhode Island
  • South Carolina
  • Vermont
  • West Virginia

Limits of Free E-Filing

More complicated returns are normally not eligible for free e-filing. Also, if you are claiming the first-time homebuyer tax credit you are not eligible to e-file at all.

And, as always, it’s free to do your taxes by hand and file them by mail. I’ve done it, even when I could have e-filed the federal ones for free (I didn’t know about the option at the time).

How do you plan to do your taxes? Are you eligible for free file? If so, will you be using it or purchasing software anyway?


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H&R Block at Home Giveaway
February 7, 2010 at 1:16 pm

{ 6 comments… read them below or add one }

Money Reasons February 3, 2010 at 12:06 pm

Hmmm, I believe you can e-file for free using the TAXACT.com, no matter what your income. I’ve been using that site for the last 4 years, and I’ve never encountered or read about an income limitation.

TaxAct.com offer a free state return though. Luckily, the state I live in has a free one already included at the state gov website.
.-= Money Reasons´s last blog ..Stop Waiting For Magical Moments To Happen =-.

Lindsey February 3, 2010 at 6:18 pm

We’ve used the free software before, but we’re using Turbo Tax Deluxe Edition this year. We don’t know enough about all of the deductions, so we decided to buy software to help us maximize our deductions. We were able to save so much money at Office Depot that it was definitely worth buying the software even if it doesn’t get us more more in terms of deductions than using the free services.
.-= Lindsey´s last blog ..Great deal at Office Depot! =-.

Allison February 3, 2010 at 10:18 pm

You just saved me a lot of time–now I know I can’t e-file state tax for free in my state. Thanks for this great post!

RainyDaySaver February 3, 2010 at 11:27 pm

I was so excited to e-file this year, but then discovered (as you said) that we can’t because we’re claiming the first-time homebuyer credit this year. But I am happy about the credit, so it’s worth the longhand filing/mailing. I will definitely do direct deposit so the refund comes more quickly.
.-= RainyDaySaver´s last blog ..Remembering Woolworth’s =-.

Stacey February 4, 2010 at 3:15 pm

Just a note: TaxACT allows you to file free with more complicated returns, too. I’ve used them for the past 3 years because they’re one of the few “free file” partners that allows me to file a Schedule C for free. :-)

No need to pay for software if you qualify for the free file! Most programs walk you through all the deductions you could qualify for with a simple “yes” and “no” Q&A session.

Pamela February 11, 2010 at 5:22 pm

I have found that I’m better off doing my state taxes by hand instead of using H&R Block’s program. Doing them by hand means I either pay less or get more money back, because my state will give you credit for charitable contributions over a certain dollar amount, even if you didn’t itemize deductions on your federal return. This year, it’s about a $75 different between the program and me.

I may look at some of the other programs and see what they come up with, though. Perhaps Turbo Tax… Thanks for the list!

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