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File tax returns for free, but read the rules
Feb 07, 2010 (Richmond Times-Dispatch - McClatchy-Tribune Information Services via COMTEX) --
File returns for free, but read rules Why pay to file state and federal income tax returns when you can do them for free online?
I filed my federal return for $29.95 on TurboTax. But my state return was free at the Virginia Department of Taxation's iFile site.
I would have filed both returns using TurboTax. But there was a gotcha at the end of the federal return: The state return, which takes only moments more to complete, would have cost $36.95 more.
No way was I going to pay almost $70 this early in the tax season when the discounts usually are plentiful. Online tax programs typically keep increasing in price as the April 15 filing deadline draws near.
Online free-filing can be simple, fast and easy to navigate. The software does the math, may find deductions that you missed, and it flags mistakes and responses that might attract an audit.
The downside is you may encounter a gauntlet of advertising and attempts to get you to upgrade. Also, there may be fees and charges for options that you select -- such as a surprise state-return fee.
Here's where to go and what to expect if you'd like to file your taxes for free:
-- "Free File" your federal taxes at IRS.gov. It's not someone at the Internal Revenue Service who inputs your tax information, so relax. It's one of 20 commercial partners of the IRS. You choose the vendor, or let the online wizard pick ones that do Virginia returns. You click through to a site and fill out your returns there.
The vendors are allowed to upsell products and services, IRS spokesman Jim Dupree said. "But you don't have to take them."
Also, some sites don't charge for state returns, while others do. The prices vary. So compare sites.
Your adjusted gross income can't exceed $57,000 to use Free File.
-- "iFile" your state return for free at the Virginia Department of Taxation's site. Don't expect bells or whistles, fancy graphics or for the software to suggest deductions. But you won't encounter ads or upselling. Also, there are only a relatively few questions to answer and no income limits. This is a government Web site.
New this year: live help. Type your questions. A real person replies. Print the answers.
Filing deadline: May 3.
-- Go directly to a reputable commercial site. Google the phrase "free online tax filing" and a ton of sites will pop up, many not affiliated with the government. Watch the word "free." It may be free only to fill in the returns. Choose a reputable preparer, such as those on the IRS list or ones that have been around a long time.
IRS' Dupree said choose an online site the same way you'd choose any tax preparer -- ask for the recommendation of friends and family, be sure the preparer will be around after the tax season and that help is available while filling out your returns.
Read the disclosures. You may eagerly click "I agree" without reading the small print. The surprises that filers encounter later often are disclosed upfront.
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Contact Iris Taylor at (804) 649-6349 or itaylor@timesdispatch.com. Follow her on Twitter at http://twitter.com/RTDIrisTaylor.
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