E-filing? Try These 5 Free Options
I have updated this post for 2021 tax filing (for the 2020 tax year). I’ve always used and recommended paid TurboTax & H&R Block online and (previously) CD software products to do my own taxes. Both have have free and cheap options available for those who have relatively simple returns, or through the IRS Free File Alliance if you fall with specified age and adjusted gross income ranges.
While TurboTax and H&R Block might be the best options for most e-filers, there are other reputable alternatives as well. After researching the marketplace, here are the five options that topped my list if your goal is to have the cheapest e-file tax return. I have affiliate partnerships with the tax software companies & the links include special discounts.
Let’s start with my two favorites: H&R Block and TurboTax.
H&R Block: offers a basic free federal and state version that has no income or age restrictions, covering basic 1040 filings. If you start with the free version, you can easily transfer and upgrade to a different version at a later time if you have additional forms in your return, but your return must be started on their website. I have used H&R Block the last few years and really like their program. H&R Block is offering 20% off their paid versions for a limited time (Deluxe, Premium, & Self-Employed) at that link.
TurboTax: offers a free basic federal and state e-file version, for simple tax returns only, called “Free Edition”. If you choose to upgrade to another version, your data is transferred if you start your return on the TurboTax website. TurboTax’s paid online versions can be found here ($20 or $30 off at link, discount varies per version).
TaxAct: TaxAct “Free” offers a free-file for basic 1040 federal returns (state costs $4.95). You can upgrade to another version, if you start your return at taxact.com. If you have more than a basic return, can get a 20% TaxAct discount here.
- Free File: if your AGI is below $72,000 ($39,000 in some cases) and your age falls within certain ranges, and you live within certain states, there are additional “FreeFile” e-file provider options, but none that I would recommend more than the previously mentioned free and paid online programs above, which don’t have the same income and age restrictions.
- Fillable Forms: If your income is above $72,000 (as well as below), and you are up for some work and have plenty of time, you can fill out forms online through the IRS fillable forms website and then e-file with them. The BIG problem with this route is that you can’t prepare or submit your state return through the IRS. This is a big pain because you have to go elsewhere to do your state return. Also, fillable forms are not nearly as simple to fill out as tax software. You literally are filling out IRS tax forms. I would not recommend it – but it is an option available to you for free e-filing.
Note: there are no IRS approved vendors that offer free-file through the Free File Alliance to those with adjusted gross income over $72,000 (and many have age restrictions as well). If your income is higher and/or you invest, are a homeowner, a parent of a child, or itemize deductions, I’d recommend going with the most appropriate paid TurboTax or H&R Block version.
- What’s the cheapest way that you’ve been able to file your taxes, while getting the best return?
- Have you done your taxes yet?
- How are you filing your taxes this year?