Tax season is upon us, which means millions of Americans will once again flock to TurboTax to file — and doing so will come at a cost for many.
In 2021, TurboTax's parent company, Intuit, pulled its tax prep software from the IRS Free File program, a partnership between the government and various tax filing services that gives eligible taxpayers the ability to prepare and submit their federal tax returns at no cost. At the time, Intuit cited limitations and “conflicting demands from those outside the program” that led it to withdraw from IRS Free File.
The announcement came after a 2019 ProPublica investigation that alleged Intuit coded its Free File page so it was hidden from Google search results. And as part of a 2022 legal settlement, Intuit agreed to send out $141 million in refunds to customers who said they'd been tricked into paying in years past.
Since then, federal authorities have taken additional steps to address Intuit's "deceptive" advertising practices. The Federal Trade Commission ruled in January that the company can no longer misrepresent its products and services or market them as free unless they cost $0 for every consumer.
Although TurboTax — Money's top pick and partner for the best tax software — is no longer part of IRS Free File, it still offers ways for some taxpayers to file their taxes for free. You may also be able to do your taxes for free through another service, including the IRS's new pilot program (more on that in a minute).
Can I file my taxes for free with TurboTax?
TurboTax offers two ways for people to file for free: TurboTax Free Edition and TurboTax Live Assisted Basic, the latter of which comes with a tax expert to virtually help you.
However, these "free" options aren't free for everyone, according to TurboTax — only 37% of taxpayers will qualify for the free edition. First, you must have a simple tax return, which means you’re only filing IRS Form 1040. TurboTax's free service covers W-2 income, interest and dividend income that doesn't require filing a Schedule B, standard deduction, the earned income tax credit, child tax credit and student loan interest deduction.
You won’t be able to file with TurboTax Free Edition if you have itemized deductions, unemployment income, business income, stock sales, rental property income or income reported on other forms, like income from crypto investments.
TurboTax Free Edition is available for the entire year, but if you want free help from a tax expert through TurboTax Live Assisted Basic, you have to file by March 31. After that, the basic service is $89 for federal returns with state returns included.
Other ways to file your taxes for free
Taxpayers who earned up to $79,000 in 2023 qualify for free guided tax prep through the IRS Free File program. The agency's list of Free File partners includes other popular providers like TaxAct and TaxSlayer. (If you earned over $79,000, you can do your taxes through Free File Fillable Forms, which is available at no charge but requires some tax knowledge.)
There's also a new free tax-filing option available to some people this year: The IRS is piloting its own service, Direct File, which is now open to eligible taxpayers in 12 states.
The website will only be available during certain windows of time as the IRS continues to conduct testing. The first thing you need to do is check to see if you're eligible — the criteria for participating each state is available on the website.
Not all tax situations are covered by IRS Direct File, like if you're self-employed, earn more than $200,000 a year or itemize your deductions. You'll also need to sign up for ID.me, a digital wallet that verifies your identity so you can access benefits and services.
If you don’t qualify, there are still ways you can file your tax return for $0. Outside of Free File, you can use TaxSlayer’s Simply Free option if you earn less than $100,000, don't itemize and don’t claim any dependents, among other criteria. You might also want to check out providers like Cash App Taxes, which allows users age 18 and up to file their federal and state taxes for free. (That said, Cash App Taxes isn't available if you have to file more than one state return, earned more than $600 in foreign income or received income from an estate or trust.)
Regardless of what you pick, remember an important point: Tax preparation usually gets more expensive the longer you wait. So don’t delay. Go forth and file.