IRS opens revamped Free File program

The Internal Revenue Service opened its Free File program on Friday, more than two weeks before the official start of tax season, with changes that should make it easier for taxpayers to find the free versions of tax prep software from vendors who have been accused of misleading consumers into paying for the products.

In late December, the IRS announced that it had signed an agreement with a new agreement with Free File Inc., formerly known as the Free File Alliance, after controversy erupted earlier this year over the difficulty of finding free versions of consumer tax prep software. A series of articles by the investigative news site ProPublica exposed problems with the Free File program, which is supposed to allow taxpayers who earn under $69,000 per year to file their taxes for free using commercial software. However, ProPublica found that some vendors such as Intuit and H&R Block were making it difficult to find the free versions of their software through search engines like Google, and consumers were oftentimes being steered toward paid products instead, even if they should have qualified for the free software.

Under the new agreement, tax software vendors who are part of the Free File program won’t be allowed to exclude their Free File landing page from an organic internet search. They have agreed to ensure a link on their sites is available to return taxpayers to the IRS Free File website at the earliest feasible point in the preparation process if they don’t qualify for the Member's Free File offer. They have also agreed to regularly survey taxpayers who have successfully e-filed a tax return through the Free File program and will report their results on a quarterly basis to the IRS.

Andrew Harrer/Bloomberg

For 2020, the vendors who are part of the Free File program include 1040Now, Inc., ezTaxReturn.com (English and Spanish), FileYourTaxes.com, Free tax Returns.com, H&R Block, Intuit, On-Line Taxes, Inc., Tax ACT, TaxHawk, Inc. and TaxSlayer (English and Spanish).

The Free File program covers the majority of taxpayers, whose adjusted gross income was $69,000 or less in 2019. Taxpayers can start their taxes now, and the Free File provider will submit the return once the IRS officially opens the 2020 tax filing season on Jan. 27 and begins processing tax returns.

“Free File online products offer free federal tax return preparation, free electronic filing and free direct deposit of refunds to help get your money faster,” said IRS Commissioner Chuck Rettig in a statement. “The IRS has worked to improve the program for this year, and we encourage taxpayers to visit IRS.gov, and consider using the Free File option to get a head start on tax season.”