It’s An announcement was madeJanuary 24th marks the official beginning of tax filing season. This means it’s that time of year again to buy some pricey tax software and prepare your return on your own, hire a tax prep pro, or take advantage of the Free File Program from the IRS.
The tax preparation process for American taxpayers who use IRS Free File Program will be a little different in 2022. TurboTax—which has been criticized in the past for some questionable tactics—has exited the IRS Free File Program.
TurboTax is the second big brand name in the tax world to end its participation in the Free File Program in just two years, as H&R Block dropped out in October 2020. The news of TurboTax’s decision was actually released last summer. But since most people’s minds weren’t on taxes at that time, many taxpayers are learning about this surprising news now.
“Intuit has elected not to renew its participation in the IRS Free File Program and will no longer be offering IRS Free File Program delivered by TurboTax,” Website claimed.
What is The IRS Free File Program and How Does It Work?
The IRS Free File Program is a tax prep and filing option that gives eligible taxpayers access to brand name software programs–without the costly fees.
If you’re eligible, you can get tax software for your return without having to pay $50 more. You can instead access online software that answers key tax questions, calculates your bill or refunds, and lets you file your return electronically.
The following is an extract from the Instructions to the IRSYou can get free software to prepare your tax return electronically and file it electronically if your adjusted gross earnings were less than $73,000. You still have the option to file your tax return electronically if you earn more than $73,000 Free file forms.
According to USA TodayAbout 70 percent of American taxpayers can qualify for the IRS Free File Program. However, only a fraction of those who qualify use the program.
IRS data revealed that only 4.2 million taxpayers used one their free online partner products, which were made available through the Free File Program in 2020. This low figure is not surprising considering the IRS processed over 150 million electronic filings in 2018.
Why is participation in the Free File Program so low?
It’s been two decades since the IRS began partnering up with tax software companies for the Free File Program. The IRS made a special agreement with the companies to not offer its own tax preparation software. The participating companies offered tax return software free of charge to a certain percentage of the American tax payer population.
The participation rate in the program was always low. Intuit’s TurboTax, H&R Block, and other partners of the Free File Program have faced criticism thanks to a 2019 ProPublica investigation.
TurboTax had made it difficult for people to find the program online, which led to this investigation. Instead, these companies were directing users to products that weren’t free. What’s more, the report revealed how Intuit added code to TurboTax’s Free File Program landing page that actually hid it from Google and other search engines.
ProPublica reported that the IRS had made some changes to their program. One of the changes was that tax prep firms were required to include taxpayers in their calculations. “Free File”Landing pages from internet search.
How to file your taxes for free
According to the IRS, taxpayers should use the term “IRS Free File Program delivered by (software provider)”When searching for the Free File Program. Or, you can simply Click hereTo access the IRS Free File Program or their fillable forms, click here
If you’ve used IRS Free File in the past, you will receive an email this tax season from the company you used. This email is for customers returning to IRS Free File and contains a link that will take customers back to IRS Free File.
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