Online Free Tax E-Filing options for 2023 (IRS FreeFile, United Way, Cash App/Credit Karma, various free basic programs)

Hello! This post is an update to one from last year and will briefly yet comprehensively discuss all known free online tax filing options for 2023, aka FY 2022. While slickdeals is a site specializing in discounts to paid products, hopefully this post will alert people to the fact that they most likely have multiple free tax filing options available. Based on last year's tax returns, over 70% of Americans are eligible for the IRS Free File program alone, to say nothing of all the other free tax filing offerings available.

These free tax filing options essentially break down into 5 categories:

1. IRS Free-File [irs.gov] (IRS provided and endorsed free tax software [irs.gov] or forms [irs.gov])
2. Premium tax software provided by an organization (United Way's MyFreeTaxes [myfreetaxes.com], MilTax [militaryonesource.mil])
3. Cash App Taxes [cash.app] (comprehensive tax software provided for free by a company)
4. Various free offers for basic returns (loss-leader programs provided by tax software companies)
5. In-person volunteer tax clinics (VITA & TCE [irs.gov])

The last category is somewhat beyond the scope of this post, which will focus on online options, i.e. ones you can explore during or immediately after reading this post. However, as a general overview, Tax Counseling for the Elderly (TCE) is designed to help seniors over age 60, while Volunteer Income Tax Assistance (VITA) targets people with either:

• incomes below $60,000
• disabilities
• limited English language skills

While participants in VITA are wide and varied, most TCE clinics are run by AARP's Tax-Aide program [aarp.org] which further opens eligibility to those over 50 years old. Please be aware that while the eligibility requirements are general and not hard-and-fast, and the assistants are qualified [irs.gov], it would still be inappropriate for someone with lists of stock transactions and itemized deductions half-a-mile long to roll in and thrust a large stack of tax documents at a volunteer. Lastly, most VITA and TCE providers [treasury.gov] don't start running clinics until early February.

With that out of the way:

IRS Free File
Most Commonly Filed Federal Forms

The IRS Free File [irs.gov] program is the result of a long-standing compromise between large tax software providers, such as H&R Block and Intuit, and the IRS: the IRS will not produce any free publicly-funded guided tax software and in return these companies will make available free versions of their cash cows to low- and moderate- income earners. While the offerings in this program tend to be the most restrictive in terms of whether you qualify to file for free, in turn the ability of the companies involved to upsell you services, hide necessary tax forms behind a paywall, or sell your data to third party partners is also greatly restricted. All participants in this program are required to provide the most commonly filed forms. [irs.gov]

Most major tax software players participate in this program except for H&R Block (left 2020) and Intuit TurboTax (quit 2021). The remaining major participants are:

• TaxAct [taxact.com]
  • Adjusted gross income (AGI) [taxact.com] of $73,000 or less
  • Between the ages of 20 and 58
  • Free state filing in: AL, AR, CT, DC, DE, HI, IA, ID, KS, LA, ME, MS, MT, OK, ND, NE, NH, NM, RI, UT, VT, WV
• TaxSlayer [taxslayer.com]
  • AGI of $60,000 or less
  • Age 57 or less
  • OR are eligible for the Earned Income Tax Credit (EITC) [irs.gov]
  • Free state filing in: AR, AZ, DC, GA, IA, ID, IN, KY, MA, MI, MN, MO, MS, MT, NC, ND, NY, OR, RI, SC, VA, VT, WV
• FreeTaxUSA [freetaxusa.com]
  • AGI of $41,000 or less
  • Any age
  • Any state
• OLT (Online Taxes) [olt.com]
  1. Option 1
     • AGI of $41,000 or less
     • Any age
     • Any state
  2. Option 2
     • Between $41,000 and $73,000
     • Age 67 or older
     • Free state filing in: CT, DC, DE, HI, IA, ID, IN, KS, KY, ME, MN, MT, ND, NE, NM, OK, OR, RI, TN, UT, VT, WV, WY

Furthermore active duty military with AGI's below $73,000 are eligible for all the above offers.

I do not currently know whether the above offers allow free state filings from multiple states.

Please note that while direct links have been provided above, they have been provided for investigative convenience. In the likely event they are broken by re-directs either at slickdeals or by the providers themselves, they should remain accessible via the IRS's Free File listings [irs.gov]. There are additional offers available there from smaller providers for federal-only free filings I have omitted from the above list for simplicity's sake. Lastly, there is an option for people whose AGI is over $73,000 to directly fill out the forms [freefilefillableforms.com] themselves online without the aid of guided tax software.

United Way's MyFreeTaxes
Most forms available

Since 2009 United Way has been offering free access to one tax prep provider with looser restrictions than the IRS FreeFile offers above. Most recently this provider has been TaxSlayer.

• MyFreeTaxes [myfreetaxes.com] via TaxSlayer
  • AGI of $73,000 or less
  • Any age
  • Unlimited states, including Puerto Rico (1040PR)
  • Also includes Non-resident alien filing (1040-NR)

Note that the questionnaire they use also has options for (a) in-person tax help and (b) those with AGI's above $73,000. These are just links to the VITA program and the IRS's Free Fillable Forms [freefilefillableforms.com] discussed earlier.

As this is a charitable program, my personal recommendation is to use the IRS's Free File options, one of which is also TaxSlayer, unless you don't meet the qualifications. It is likely United Way has to pay more for this service the more people file using it. If you do use MyFreeTaxes, consider donating to United Way.

MilTax (DoD)
Most forms available

The Department of Defense makes comprehensive tax software called MilTax [militaryonesource.mil] available for free to active military personnel. It is supposedly purpose built to handle tax situations common among deployed service members and their families. Additionally they offer in-person support through the VITA program.

Cash App Taxes
Many forms available

For several years Credit Karma [creditkarma.com] operated a home-grown free tax filing service, before recently selling it [forbes.com] to Square, the online payment company, due to anti-trust concerns arising from Intuit buying Credit Karma. Post-sale this product is now called Cash App Taxes [cash.app] and is linked to the smartphone app of the same name. Thus in order to use this service, you must first download the app and sign up to do your taxes through it, at which point you can sign-in via a browser.

• Cash App Taxes [cash.app]
  • Any AGI
  • Any age
  • All states

Helpfully they publish a large list of unsupported tax situations [cash.app] which include residents of Puerto Rico, multiple state filings, foreign income, and married-filing-separately in community property states such as Arizona, California, Idaho, Louisiana, New Mexico, or Wisconsin.

Intuit TurboTax Free Edition and Live Assisted Basic
Form 1040 only

TurboTax is the granddaddy of all tax software, and Intuit has a very limited free offer [intuit.com] available to filers of Form 1040 only, with no additional tax forms appended. For those who don't know tax lingo, this means only:

• W-2 income
• Limited (less than $1,500) interest and dividend income reported on a 1099-INT or 1099-DIV
• standard deduction (not itemized deductions)
• Earned Income Tax Credit (EIC)
• Child tax credits
• Student loan interest deduction

Additionally if you file before 3/31/23 you will have access to limited live help via Live Assisted Basic. However if you require so much live help that the assistant signs your tax return as the preparer, you will be charged for the full live support package. Other than those substantial caveats, this free offer is good for

• Any AGI
• Any age
• Any state (including, apparently, multiple states)

H&R Block Free Online
A bit more than Form 1040

H&R Block, the #2 tax software maker after Intuit, offers a similar free online [hrblock.com] product that states it "offers more for free than TurboTax Free Edition," including unemployment income (1099-G), and tuition reimbursement. They helpfully list both supported federal forms [hrblock.com] and state forms [hrblock.com]. However, they do not provide any free live help.

• Any AGI
• Any age
• Any state (including, apparently, multiple states)

TaxSlayer Simply Free
Form 1040 only

TaxSlayer's non-IRS-Free-File offering is for a very basic [taxslayer.com] Form 1040 only tax return, with only phone and email support. 1 free state filing is also included.

• Any AGI
• Any age
• Any state

The rest
State additional; or free if you aren't required to file a state return

TaxAct [taxact.com]'s non-IRS-Free-File offer allows for more situations than a simple 1040-only return, but also includes "unlimited" live help. State filing is $39.99 each.

FreeTaxUSA [freetaxusa.com]'s normal pricing is free federal filing, with all forms supported, and each state costing $14.99. Live support also isn't free.

OnlineTaxes [olt.com] also has normal pricing of $0 on their federal return, all forms supported, with each state costing $9.99.

These offers may be appropriate for people who live in a state that does not have a state income tax and therefore does not require state income tax filing. These states are:

• AK, FL, NV, SD, TX, WA, WY

Also, two states don't require residents to file state income returns unless they received 1099-INT or 1099-DIV income statements.

• NH, TN

Data Privacy Caveats

The companies offering tax software provide free offerings, either on their own or through the IRS FreeFile program, for three main reasons:

1. As a political maneuver to stop the IRS from stepping in and releasing its own free software
2. To better collect valuable personal data on filers
3. To upsell consumers on more expensive paid options and support

The last of these options is believed to be the reason Intuit TurboTax and H&R Block exited the FreeFile program: FreeFile's terms restrict the ability of companies to advertise paid upgrades to the tax filer while in app. Thus, if you choose to use any of the options above that aren't sponsored by a organization or part of the IRS Free File program, be wary of straying into paid-support or additional-form territory that will convert a free tax filing into a potentially expensive one.

As for the second reason, the Cleveland Plain-Dealer published an article [cleveland.com] in 2012 and 2019 looking at the personal data sharing policies of the major tax software providers of tax software, both installed and online, paid and free. Indeed, paying for electronic tax filing doesn't protect you from data privacy invasions:

Quote : Fox noted that, years ago, an executive with one tax prep software company bragged to investors that consumers came in every year and updated their data files - voluntarily and while actually paying the company.

In addition to companies themselves using (or misusing) your tax and personal data, a further concern for online tax preparation and filing is the use of third-party frameworks in building and operating such sites and the data they might leak. Recently a long-running investigation [themarkup.org] by The Markup of the Meta Pixel, an analytic tool Facebook's parent company provides for free for use on interactive websites, discovered [themarkup.org] it was being used at TaxAct, TaxSlayer, and H&R Block, and was transmitting sensitive tax data back to Meta. Additionally, TaxAct was also using Google Analytics, which was likewise harvesting sensitive user data from the pages it was active on. While this all appears to have been an accidental breech of customer privacy (on the part of the tax companies) the fact remains Google and Facebook have collected tax data from millions of people just from this single method.

Whether such websites - which can at least be somewhat inspected by privacy advocates, as above - are worse than discrete software, which is more of a black box trusted to run on your personal computer, is left up to the reader.

Lastly keep in mind that any tax data can be acquired through purchase of the company itself, as occurred when Credit Karma Taxes was purchased by Square.

Disclaimer: all of the above does not constitute an endorsement of any particular service nor should be regarded as tax advice. Corrections and comments welcome.