Seniors and retirees should know that they may be able to use online tax preparation software free of charge. Most low- and middle-income Americans qualify for free help but do not take advantage of it, and all seniors, regardless of their income, are eligible for free counseling assistance from the Internal Revenue Service.
The tax preparation software industry has had a decades-long deal with the IRS to make free versions of its software available to low- and middle-income individuals. However, a report by ProPublica in April 2019 revealed that software companies were making it difficult for customers to find the free tax filing software. According to the IRS’s Taxpayer Advocate Service, some 70 percent of taxpayers qualified for free filing, but only 1.6 percent used the free software in 2018. The IRS has subsequently amended its agreement with the software industry to bar companies from hiding the free products.
The IRS Free File website links to the available free products. Each company sets its own eligibility standards based on income, age, and state residency, but as long as your adjusted gross income is $69,000 or less you will find at least one free product to use. There are also two products that are in Spanish.
If you would rather not prepare your own tax return, seniors can use the IRS’s Tax Counseling for the Elderly (TCE) program. The TCE program is available to taxpayers who are 60 years old or older and specializes in answering questions about pensions and retirement plans.
For the IRS Free File web page, go to: https://www.irs.gov/filing/free-file-do-your-federal-taxes-for-free
For the TCE program, go to: https://www.irs.gov/individuals/free-tax-return-preparation-for-you-by-volunteers