The IRS and its private-sector partners have announced the opening of Free File, the free tax preparation and free electronic filing initiative that marks its fourth year. A new agreement between the IRS and the Free File Alliance, the consortium of tax preparation software companies, means enhanced services and more information for taxpayers who use the free services. Taxpayers must access Free File through IRS.gov.

Among the services and improvements this year:

• The 3 million taxpayers who used to file their income tax return through TeleFile, an option no longer available, automatically qualify for Free File this year;
  
  
• Seventy percent of the nation's taxpayers - those with an adjusted gross income of $50,000 or less - will be eligible, but each company sets its own criteria;
  
  
• Alliance members who offer refund anticipation loans (RALs) must disclose fees and interest rates upfront and must make clear that RALS are loans, not tax refunds. Taxpayers also must consent to receive additional information about ancillary financial products;
  
  
• Alliance members will provide additional tax forms such as Form 4868 that allows for automatic extensions of time to file;
  
  
• Alliance members' Web sites will display whether state online tax preparation and filing services are available and the associated fees, if any.

For 2006, taxpayers with access to a computer and the Internet may check on IRS.gov to determine if they will qualify for Free File.

...back to 19 January 2006


Further information:
Free File Opens Today with Enhanced Taxpayer Services

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Taxpayers may file their 2005 tax returns electronically beginning January 13 as IRS e-file celebrates its 20th anniversary. The IRS today also is launching the Electronic IRS, a centralized source for all IRS electronic options. Taxpayers and tax preparers who click on the Electronic IRS logo, located at IRS.gov, are taken to a page that contains an overview of all the electronic tasks that can be accomplished online.

The IRS began the e-file program in 1986 as a pilot project in three cities: Cincinnati, Ohio, Phoenix, Ariz., and Raleigh-Durham, N.C. That year, there were 25,000 tax returns filed electronically. The e-file program expanded nationwide in 1990 and 4.2 million tax returns were filed. Last year more than 68.4 million tax returns, 52 percent of all returns, were filed electronically.

...back to 19 January 2006


Further information:
IRS e-file Marks its 20th Year; Electronic IRS Makes Debut

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