IRS Free File helps Utah taxpayers with new health care law

stock image | St. George News

PHOENIX, Arizona — The Internal Revenue Service and the Free File Alliance announced the launch of Free File, which makes brand-name tax software products and electronic filing available to most taxpayers for free.

Free File software can help taxpayers with tax preparation, including the health care law that will affect almost everyone. People can use Free File software immediately.

Free File is available only online, thanks to a partnership between the IRS and the Free File Alliance, a consortium of 14 leading tax software companies that make their branded products available for free. Since 2003, more than 43 million people have used Free File, saving $1.3 billion based on a conservative $30-fee estimate. Locally, 26,699 Utahns choose Free File to submit their tax return last year.

“You don’t have to be an expert on taxes or the new health care law. Free File software can help walk you through the rules and help you get it right,” said John A. Koskinen, IRS Commissioner. “For 12 years, this partnership between the IRS and the Free File Alliance has helped taxpayers save both money and time. The real winner in this partnership has been the nation’s taxpayers.”

Tim Hugo, executive director of the Free File Alliance, said, “We are proud to once again offer the industry’s most innovative and secure tax software at no cost to 70 percent of American taxpayers. Tax time can be stressful, but Free File makes step-by-step help accessible to everyone making $60,000 or less. IRS.gov/FreeFile is the one place where taxpayers can choose from a variety of industry-leading tax software options in order to prepare and e-file their federal tax returns at absolutely no cost.”

If you earned $60,000 or less last year, you are eligible to choose from among 14 software products. If you earned more, you are still eligible for Free File Fillable Forms, the electronic version of IRS paper forms.

More than 70 percent of all taxpayers – 100 million people – are eligible for the software products. Each of the 14 companies has its own special offers, generally based on age, income or state residency. Taxpayers can review each company offer or they can use a “Help Me” tool that will find the software for which they are eligible.

Free File offers easy-to-use products that ask questions and you supply the answers. The software will find the right forms, find the right tax credits and deductions and even do the math for you.

Some companies also offer free state tax return preparation as well.

Free File also can help taxpayers with the new health care requirements. Almost everyone will need to do something new when filing a tax return this year. For each month in 2014, you and everyone on your return must:

  • Report health care coverage, or
  • Claim an exemption from coverage or
  • Make a shared responsibility payment with your tax return.

Most people will simply have to check a box to report health care coverage for the entire year.

If you or anyone on your return purchased coverage from the Health Insurance Marketplace, you may be allowed to take the Premium Tax Credit. If you opted for any advance payments of the Premium Tax Credit to help with your monthly insurance premium payments, you must file a tax return, even if you were not required to file. You must reconcile your advance payments with the amount you were due.

“Our employees will be working hard again this season to help the nation’s taxpayers,” Koskinen said. “We encourage people to use the tools and information available on IRS.gov, particularly given the long wait times we anticipate on our phone lines. As always, taxpayers can benefit by filing electronically.”

Free File will be available through October 2015. Taxpayers have the option to prepare their return at any time and schedule a tax payment as late as the April 15 deadline. Taxpayers who cannot meet the April 15 tax filing deadline can also use Free File to file for a six-month extension.

Here are some common tax-related documents you will need to complete your tax return – Remember, you must also have documentation of any credit or deduction you are claiming as well:

  • A copy of last year’s tax return;
  • Valid Social Security numbers for yourself, spouse and children;
  • All income statements, i.e. W-2 forms, from all employers;
  • Interest/dividend statements, i.e. 1099 forms;
  • Form 1099-G showing any state refunds;
  • Unemployment compensation amount, if any;
  • Form 1095-A if you purchased coverage from a Health Insurance Marketplace;
  • Proof of health care insurance coverage for you and everyone on your return.

In the coming weeks, the administration will continue to provide additional resources to help consumers prepare for tax filing season, including online tools to help individuals connect with local tax preparation services and determine if they are eligible for an exemption.

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