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Uncle Sam offers free tax return preparations

by Broderick Perkins

(2/17/2012) Erate Exclusive - Get you tax return completed for free?

Fugedaboudit.

No, seriously, there are several ways to get your tax return completed for free, the tax software coalition-Internal Revenue Service (IRS) partnership called "Free File," the Volunteer Income Tax Assistance (VITA) Program, the Tax Counseling for the Elderly (TCE) Program and a new Facilitated Self-Assistance (FSA) Program

And, well, yeah, sure, you can always let your own Uncle Sam, Tom, Dick or Harry take a crack at it and cross your fingers, but it's probably better to stick with services from the Real McCoy.

The idea, in this tough economy is to find ways to save money, rather than get deeper in debt or worse, audited.

"IRS Free File provides free tax services for 100 million Americans, including those who may have been hit hard by the current economic climate," said Tim Hugo, executive director of the Free File Alliance.

• Free File

Certainly, the coalition of tax software companies, called the Free File Alliance, is getting a ton of free marketing and ad revenues from Free File, but it's got IRS' blessing as both fast and safe, as well as free.

The alliance includes H&R Block, Turbo Tax, TaxSlayer, eSmart Tax and about a dozen others.

An IRS survey about last year's program found that 96 percent of users said Free File was easy to use and 98 percent said they would recommend the program to others. So you only have a two to four chance of being disgruntled.

All taxpayers with a 2011 adjusted gross income (AGI) of $57,000 or less can go to the IRS' Free File site and get to work. The IRS says 70 percent of all taxpayers meet the income requirement.

Depending upon which software you choose, other eligibility requirements could include your age, state, eligibility for the Earned Income Tax Credit, and military status.

The IRS also advises you to check the software company's website for additional details because the companies' offers may differ. Some companies could charge a fee for state tax returns and some may not support a particular form you need to file.

Before choosing a company you'll need a copy of last year's tax return for a quick estimate of your AGI. You'll also need your W-2s, 1099s, other records of income, expenses (if you have a small business) and deductions.

The alliance says the online software guides you through each step of the preparation and filing process, but taxpayers with complicated returns are advised to seek professional help.

• Anyone can use Free File forms to file electronically, without the software or the $57,000 income requirement, provided you need little assistance completing your return and can use IRS instructions and publications to get you through the ordeal.

Again, if your return is complicated by investments, business income and expenses, casualty losses, divorce and other matters, get professional help.

Professional help is available for free in person for those who quality and use other free-filing programs.

• IRS Volunteer Income Tax Assistance (VITA)

VITA offers free tax return assistance from some 12,000 locations nationwide for people who make $50,000 or less and need assistance. Generally located at community and neighborhood sites, IRS-certified VITA volunteers provide free basic income tax return preparation and advice about special tax credits, deductions and other benefits you may overlook.

Find a VITA site near you online or call 1-800-906-9887.

• Tax Counseling for the Elderly (TCE)

TCE offers free tax help for all, but people who are 60 years of age and older, go to the head of the line. The service specializes in questions about pensions and retirement issues unique to seniors. IRS-certified TCE volunteers are often retired individuals associated with non-profit organizations that receive grants from the IRS.

Look for an AARP Tax-Aide online or call 1-888-227-7669 for more information.

For VITA and TCE assistance be sure to bring:

• Proof of identification with your photo on it.
• Social Security cards for you, your spouse and dependents or a Social Security Number verification letter issued by the Social Security Administration or Individual Taxpayer Identification Number (ITIN) assignment letter for you, your spouse and dependents.
• Proof of foreign status, if applying for an ITIN.
• Birth dates for you, your spouse and dependents on the tax return.
• Wage and earning statement(s) Form W-2, W-2G, 1099-R, 1099-Misc from all employers.
• Interest and dividend statements from banks (Forms 1099).
• A copy of last year's federal and state returns, if available.
• Proof of bank account routing numbers and account numbers (such as a blank check) for direct deposit.
• Total paid for daycare provider and the daycare provider's tax identifying number (the provider's Social Security Number or the provider's business Employer Identification Number), if appropriate.
• To file taxes electronically on a married-filing-joint tax return, both spouses must be present to sign the required forms.

• Facilitated Self-Assistance (FSA)

Finally, in addition to traditional face-to-face tax preparation, the IRS is launching a self-assistance service at select locations. It's for taxpayers who have a simple tax return and need a little help or do not have access to a computer. They can visit one of the participating tax preparation sites and an IRS-certified volunteer will guide them through the process.

Additional Info added January 30, 2024:

The new Facilitated Self-Assistance (FSA) program aims to address the needs of taxpayers who are comfortable with completing their tax return but may require some guidance or lack the necessary resources. This program is particularly beneficial for those with straightforward tax situations, such as individuals without dependents, major investments, or complicated tax deductions.

FSA centers are equipped with computers and internet access, allowing taxpayers to prepare their returns using IRS-approved software. IRS-certified volunteers are available at these sites to assist with questions and guide users through the process. This service is especially useful for people who do not own a computer or have limited internet access at home.

The IRS emphasizes the importance of bringing necessary documentation when visiting an FSA center. This includes identification, tax documents such as W-2s and 1099s, information about any dependents, and details of any deductions or credits that may apply. The goal of FSA is to make tax preparation less daunting and more accessible, especially for those who may feel overwhelmed by the process or are unsure about using online tax software independently.

This initiative is part of the IRS's broader effort to make tax services more inclusive and accessible. By providing a range of options – from completely free online filing for those with simple tax situations to in-person assistance for more complex cases – the IRS aims to ensure that every taxpayer can find a service that suits their needs. With these programs, the IRS is making strides towards reducing the financial burden of tax preparation and helping citizens navigate their tax obligations with greater ease and confidence.

Find an FSA site online.

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