IRS to Launch Free File Service Starting January 10
The IRS will open its Free File service this week, enabling eligible taxpayers to prepare and file their federal income tax returns online at no cost. The service will be available beginning Friday, January 10, allowing taxpayers to get an early start on their filings before the official tax season begins later this month.
Free File is a partnership between the IRS and Free File Inc., a nonprofit coalition of tax software providers. The program offers taxpayers a secure and simple way to file their returns, with the assurance of accuracy in calculations from participating partners. Some providers may also offer free state tax preparation, though the IRS does not endorse any specific provider.
While taxpayers can begin preparing their returns on January 10, they will only be able to submit them when the official filing period starts. The Free File service is available to individuals with an adjusted gross income (AGI) of $84,000 or less for the 2024 tax year. AGI is the total income minus certain deductions such as student loan interest or IRA contributions.
This year’s Free File service is offered by eight providers: 1040Now, Drake (1040.com), ezTaxReturn.com, FileYourTaxes.com, On-Line Taxes, TaxAct, TaxHawk (FreeTaxUSA), and TaxSlayer. It is also a valuable tool for taxpayers claiming credits like the Earned Income Tax Credit or Child Tax Credit.
“Through our partnership with Free File Inc., we continue to offer taxpayers secure and free ways to file their taxes electronically,” said IRS Commissioner Danny Werfel. This marks the 23rd filing season for the Free File program.
For taxpayers with an income exceeding $84,000, the IRS offers Free File Fillable Forms, which are expected to be available starting January 27. These forms are ideal for those who prefer to prepare their own returns.
Free File vs. Direct File
In addition to Free File, the IRS is rolling out Direct File, a service that allows taxpayers to file their returns directly through the IRS. While Free File is a partnership with third-party providers, Direct File is managed by the IRS itself. Direct File was tested in the 2024 season and will be available in 24 states for the 2025 tax season. The IRS estimates that over 30 million taxpayers will be eligible for Direct File this year.
To access Free File, taxpayers must visit the IRS website that lists all participating entities. The IRS warns that users should not go directly to a company’s website, as they won’t receive the free service if they do.
The IRS ensures that all participating providers adhere to strict privacy rules, ensuring that taxpayers’ data is not misused. However, the service has faced some criticism, including a 2022 report from the Government Accountability Office, which found that some providers advertised their services outside the Free File program.
With the introduction of Direct File, the IRS now offers both options for taxpayers to file their returns without going through intermediaries. However, Direct File has also faced criticism, with some political figures calling for the service to be discontinued.