How to do your taxes for free in 2022

Chegg
·6 min read
Woman standing in front of tax return forms
Woman standing in front of tax return forms

It shouldn’t cost money to pay your taxes, right? Not quite. The U.S. tax system is so complicated that it can seem impossible to file without the help of software or a professional — services that can cost hundreds of dollars.

But there are ways to file for free, even if options have become more limited in recent years. Honestly, the process is confusing.

Still, it is possible to file for free, as long as you’re informed. So don’t sweat it! We’ll help get you squared away so the looming tax season doesn’t weigh you down. Here's what your need to know.

First, get familiar with IRS Free File

The IRS Free File program is a private-public partnership where tax preparation companies work with the government to provide free filing to Americans below a certain income level. This year, anyone with an adjusted gross income (i.e., your salary minus deductions) less than $73,000 can file taxes for free via one of the IRS’s eight corporate partners, which include:

  • TaxAct

  • TaxSlayer

  • ezTaxReturn

  • FreeTax USA

  • FileYourTaxes.com

  • OnLine Taxes at OLT.com

  • 1040Now

  • Free1040TaxReturn.com

Note that some of these tax filing services have income thresholds lower than $73,000, or have additional eligibility criteria (more on that below).

I’ll also pause here to say that, in a perfect world, the IRS would have one free, universal, online, easy-to-use filing system. Unfortunately, tax prep companies have spent years and millions of dollars lobbying to prevent the IRS from creating one. And thanks to issues like inadequate funding and poor advertising, only a fraction of the 70% of eligible Americans actually use it.

Don’t be a statistic! Filing opened on January 14, so you can get started now. It’s important you start on the IRS’ Free File page and not on a company’s website, even if it advertises free filing there.

You might notice that the partner companies listed above aren’t exactly household names. TurboTax and H&R Block used to be part of IRS Free File, but both pulled out of the program in recent years. Each still offers its own free edition, without IRS partnership, but be aware that those versions only accommodate basic tax situations.

Now, choose an IRS Free File provider

Some of the IRS partners limit their offerings in the fine print. This means that not every partner will serve your tax filing needs. Some things to look out for:

State tax filing

  • Only two of the IRS’s partners offer free state tax filing to those who meet their eligibility criteria: FreeTaxUSA and OnLine Taxes at OLT.com. The other partners offer state filing only to residents of certain states, and some don’t offer free state filing at all. Make sure your chosen provider offers filing for your state before getting started, so you don’t get surprised later.

  • Fortunately, many states have their own Free File programs. Find out which here.

Income criteria

  • Although the IRS promises free filing to anyone making less than $73,000, some partners have their own thresholds.

    • $73,000 or less: Free 1040 Tax Return, 1040Now, ezTaxReturn.com, OnLine Taxes at OLT.com (minimum income $16,000), FileYourTaxes.com (minimum income $9,500)

    • $65,000 or less: TaxAct

    • $41,000 or less: FreeTaxUSA

    • $39,000 or less: TaxSlayer

Age criteria

  • In addition, some of these companies impose age limits:

    • 65 or younger: FileYourTaxes.com

    • 56 or younger: TaxAct

Filing for free even if you make more than $73,000

Many companies offer free filing options for people of any income level. The catch? These packages often cover only basic tax situations, while IRS Free File covers most forms.

What does this mean, exactly? You might not be able to file using the free version if you:

  • are self-employed;

  • own a business;

  • have investments;

  • need to file forms for other income, deductions or credits.

Every company has its own criteria for what comes free and what it upcharges for, so make sure you know what forms you’ll need going in and read the fine print.

The best free versions of tax software

These are some of the best-reviewed free tax filing software, and a quick overview of what they do and don’t cover.

H&R Block

  • Pros: State and federal returns, earned income tax credit, education credits, bank interest and dividends income, student loan interest and child tax credits. Unlike most free versions, it accommodates unemployment insurance as well as Schedule 1 and Schedule 3 forms (for reporting deductible student loan interest, certain retirement contributions, alimony, the lifetime learning credit and the saver’s credit).

  • Cons: They don’t accommodate forms for landlords, freelancers, HSAs or small businesses.

TurboTax 

  • Pros: State and federal tax returns, earned income tax credit, child tax credits and student loan interest. They also offer calculators where you can estimate your tax refund ahead of time, and provide audit support.

  • Cons: Unlike H&R Block, TurboTax from Intuit does not accommodate unemployment insurance and doesn’t offer Schedule 1 or Schedule 3 forms. It also doesn’t include the forms for landlords, small businesses, freelancers or stock sales.

Cash App Taxes (formerly Credit Karma Tax) 

  • Cash App bought Credit Karma Tax in 2020 and rebranded it as Cash App Taxes. It’s unique in that all its e-file tax software is free; it has no paid version or products.

  • Pros: Cash App Taxes is the only software where nearly everything is free for most users. They cover most IRS forms and schedules for both federal and state returns.

  • Cons: They don’t cover multi-state employees or people with foreign income. Also, don’t expect as many support features or customer service options as other companies.

FreeTaxUSA

  • Pros: Free is FreeTaxUSA’s whole thing: all federal forms are free, for everyone.

  • Cons: No state filing. Also, FreeTaxUSA is not free for filers living outside the U.S. or with foreign income.

Tax Act 

  • Pros: Tax Act accommodates basic tax filing, earned income credit, child tax credit and unemployment.

  • Cons: No state filing, no student loan interest expenses, doesn’t cover schedules 1, 2 or 3.

You might qualify for some extra help

On top of free online versions and IRS Free File, a specific government program, called Volunteer Income Tax Assistance, pairs people with serious barriers to completing their taxes with tax-savvy volunteers. VITA will contract a volunteer IRS-certified tax expert to prepare your return free of charge if you:

  • have a disability;

  • earn less than $57,000;

  • speak English as a second language; or

  • are a senior citizen.

All VITA volunteers — many are retired IRS tax professionals or legal nonprofit employees — have to pass tax law training. Plus, all returns receive an IRS review before being filed. You can work with a volunteer virtually or in person at a VITA site, often located at libraries, food banks and other community centers. At some sites, you have the option to prepare your own return with a VITA volunteer to guide you through. You can find the closest VITA site to you here, or read more about eligibility here.

File before April 18!

April 18, 2022, is this year’s deadline for taxpayers to submit their tax returns, so you’ve got plenty of time to evaluate your options. Try not to leave things to the last minute, because, well, wouldn’t it feel better just to have this whole thing off your plate?

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