Presidential Initiatives
Program Manager |
David Williams |
|---|---|
Managing Partner |
Department of the Treasury |
Description |
Creates a single point of access to free on-line preparation and electronic tax filing services provided by Industry Partners to reduce burden and costs to taxpayers. |
Progress to Date |
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Next Steps |
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Web Site |
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Performance |
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Exhibit 300 |
Not available - has always been included as component of larger Treasury investment (Modernized e-File) |
The IRS’s Free File program allows eligible taxpayers to prepare and electronically file their tax returns over the Internet using commercial software for free. This free filing service is available at www.irs.gov and is made possible through a partnership between the government and the Free File Alliance, a coalition of tax preparation software manufacturers.
The benefits of using these free services are identical to those of e-filing, which include:
- Reduced tax return preparation time
- Faster refunds
- Accuracy of returns
- Paperless process using electronic signatures
- Acknowledgement of return receipt
- Variety of free services to choose from
- Reduced fears about transmitting tax data to third parties
- Introduction of e-filing to taxpayer segments that have not yet been exposed to this capability
- Use of free tax preparation software is comparable to the Alliance Company’s paid product
In October 2005, the IRS and the Free File Alliance extended its partnership to provide free federal online tax preparation and e-file services to American taxpayers. During negotiations for the four-year agreement, the IRS and the Alliance agreed that to ensure the long-term stability of the Alliance, the scope of this program will focus on providing tax preparation and e-filing services to taxpayers least able to afford them. About 70 percent of all filers, or nearly 95 million Americans with an adjusted gross income (AGI) of $54,000 or less, are eligible for Free File in 2008. This new agreement allows taxpayers who most need free filing services to remain eligible for them. Since initially debuting in 2003, the IRS has received more than 19.3 million tax returns through Free File, representing a cost-savings to the government of more than $45.5 million in processing costs of an electronic return compared to that of paper.
