Julie Jason: Don’t wait to file your taxes.
Is it too soon to file your 2019 tax return? IRS Free File is ready if you are.
IRS Free File is available to most taxpayers, namely those who earned roughly $70,000 or less in 2019. It’s free. It’s easy. You can even use your mobile phone to do the filing. For the millions of taxpayers who qualify, what could be easier?
And if a refund is due, using Free File will get you that refund through free direct deposit, which is faster than any way to get a refund, according to the IRS. If you owe taxes, you can use Direct Pay or electronic options to pay the U.S. Treasury.
Free File is a publicprivate partnership between the IRS and Free File Inc., a consortium of tax software providers who make their Free File products available at IRS.gov/FreeFile.
At that link, you will find 10 software products to choose from: FileYourTaxes.com; Free Tax Returns.com, Inc.; TaxAct Free File; IRS Free File Program delivered by TurboTax; 1040NOW.NET; H&R Block FFA Tax Software; FreeTaxUSA IRS Free File Edition; and Online Taxes at OLT.com. Two more, ezTaxReturn.com LLC and TaxSlayer, offer both English and Spanish versions.
You can browse all offers at apps.irs.gov/app/ freeFile/jsp/index.jsp.
The quickest way to see if you qualify is to use the Free File Online Lookup Tool at apps.irs.gov/app/ freeFile/jsp/ WizardHandler.do.
There you will enter your age, your estimated adjusted gross income, your state, whether you are eligible for the earned income tax credit, whether you or your spouse received military pay in 2019, and, if you need to file a state return, the name of that state.
When I tried the tool using a hypothetical example, I found four options that offered free federal and state returns and five that offered free federal returns only. Using that list, I could link to any one of those providers to confirm that I qualified for the free service before going forward with the return. It’s that simple.
After that, you create an account and answer questions that take you through your return.
Before you start that process, you’ll need your Social Security number, of course; Form W-2 or Form 1099; and documentation for tax credits and deductions, if you are claiming any. Note that it’s unlikely that you will claim deductions (only a small percentage of taxpayers do). Most taxpayers take the standard deduction instead, according to the most recent data from the IRS.
By the way, if you want to get your refund quickly, the fastest way is through direct deposit to a bank account, which you can authorize using Free File. You’ll need your bank account and bank routing number to process the refund.
Before you sign the return, you’ll need one more piece of information. All electronic tax returns need to input the prior tax year’s “adjusted gross income” (line 7 of the 2018 Form 1040) as part of Free File’s electronic signature. If you are just starting a working career and this is your very first tax return, enter zero (0) as your prior-year income for signature purposes.
Free File is a worthwhile service for taxpayers who qualify. If you have not used it, take the time to explore the benefits of filing your taxes this way.
“The software finds the right forms, finds any tax benefits and does all the math,” said Ken Corbin, commissioner of the IRS’ Wage and Investment Division.
I’m sure the IRS will thank you for filing electronically — and filing now. Why wait, especially if you are due a refund?
Go to irs.gov/filing/freefile-do-your-federal-taxesfor-free.
On another note, if you participate in your 401(k) at work, would you like to be recognized as a 401(k) Champion? Apply for the second annual 401(k) Champion Award at juliejason.com/award. The award shines a light on participants who “love” their 401(k)s.
Finally, if you live in the Stamford area, join me on Jan. 29 from 11 a.m. to noon for my “High Net Worth Gifting Roundtable.” The topic: How to leverage taxfree gifts to family members into retirement nest eggs. Space is limited. To register, email Theresa@juliejason.com or call 203-322-1198. Julie Jason, JD, LLM, a personal money manager (Jackson, Grant of Stamford) and author, welcomes your questions/comments (readers@juliejason.com). Her awards include the 2018 Clarion Award, symbolizing excellence in clear, concise communications. Her latest book, a curated collection of Julie’s columns, is “Retire Securely: Insights on Money Management From an Award-Winning Financial Columnist.” To hear Julie speak, visit juliejason.com/events.