IRS launches free tax prep software ahead of filing season
Despite an ongoing government shutdown, the Internal Revenue Service is helping Americans gear up for tax season, which officially begins later this month.
FreeFile, a tax tool intended to help lower-income Americans file, launched for the season on Friday. FreeFile is a free online software program offered by the IRS to help those with incomes of $66,000 and under prepare their documents.
According to the agency, 70 percent of filers – or 100 million people – are eligible to use the software, which has helped 53 million taxpayers over 16 years. By entering some personal information, like state of residence and age, FreeFile matches users with relevant products – often eligible taxpayers will receive multiple options to choose from.
The software might be particularly useful for some taxpayers this year as they begin to file under the Tax Cuts and Jobs Act for the first time. The program has been updated to account for the changes, in addition to other improvements.
FreeFile is the product of a partnership between the IRS and the Free File Alliance – a consortium of 12 private partners. It can be used by any taxpayer to file an extension.
The first day Americans can file their 2018 taxes is Jan. 28. On that day, other e-filing services will become available to all Americans, regardless of income level.
While only about one in eight IRS employees is currently at work during the shutdown, the Trump administration assured Americans they would be issued tax refunds if the protracted political fight carries on through the 2018 tax season. That is a reversal of traditional policy, whereby Americans have been required to file their taxes but the agency isn’t expected to issue refunds until workers return.
Many American households rely on annual tax refunds, as more than 70 percent of Americans receive money back from the IRS during tax season. Last year, the average refund was more than $2,890, according to the agency.
However, as previously reported by FOX Business, taxpayers might run into a number of headaches this tax season as a result of the ongoing shutdown, including the inability to contact the agency regarding questions pertaining to documents, or the new law.
The agency said it is planning on recalling more workers – but it has yet to detail how many, or other contingency plans.
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The government shutdown began on Dec. 22. Over the weekend it passed the threshold to earn the title of the longest lapse in federal funding.