Up to 78 Million Taxpayers Will Be Able to File For Free

The Treasury Department has signed an agreement with Free File Alliance, LLC, an organization representing a consortium of tax software companies, to enable as many as 78 million taxpayers to file taxes online at no cost.

Beginning in January 2003, tax software companies who decide to join the consortium will each offer free tax filing services for up to 10% of US taxpayers. Each software company is entitled to set its own rules for determining which taxpayers qualify for the free services. Depending on the number of taxpayers who participate and the requirements for those who avail themselves of the free services, it is estimated that the program will benefit at least 60% of the nation's taxpayers.


What's your view, is this a good move? AccountingWEB wants you to voice your opinion on the merits of this new IRS initiative. (Comments will appear below within 24 hours.)


In exchange for providing the free services, which have already been offered in years past by major tax software companies such as Intuit (maker of TurboTax software) and H&R Block (maker of TaxCut software), there will be links to the participating companies on the IRS Web site and the FirstGov Web site.

"This represents an important step forward for taxpayers and our e-filing efforts," said IRS Commissioner Charles O. Rossotti. "This will give millions of taxpayers free access to preparation and e-filing."

Several consumer groups have objected to the program, suggesting that by encouraging taxpayers to use the free services, the government is providing the members of the e-filing consortium with a captive audience to whom they can offer other fee-based services.

The IRS favors the program over the alternative of developing its own tax software and competing with the tax preparation companies.

"We are one step closer to allowing millions of taxpayers free electronic filing of their tax returns," said Treasury Secretary Paul O'Neill. Congress has mandated that the IRS find a way to have 80% of the nation's tax returns filed electronically by 2007.

You may like these other stories...

There it stands, your client's 100-year-old, rickety, vermin-infested barn or former hotel or whatever the darn thing once was. And she's considering what to do with it. There are two words that can help her decide...
It's not a reality—yet—but accounting software is poised to eliminate accountants. We are at a tipping point for many similar professions: online education replacing professors, legal software replacing...
Did you know that the tax code allows you to claim tax deductions for household damage caused by thefts, vandalism, fires, floods, hurricanes, and others kinds of casualties? But the law imposes several restrictions.Relief...

Upcoming CPE Webinars

Jul 31
In this session Excel expert David Ringstrom helps beginners get up to speed in Microsoft Excel. However, even experienced Excel users will learn some new tricks, particularly when David discusses under-utilized aspects of Excel.
Aug 5
This webcast will focus on accounting and disclosure policies for various types of consolidations and business combinations.
Aug 20
In this session we'll review best practices for how to generate interest in your firm’s services.
Aug 21
Meet budgets and client expectations using project management skills geared toward the unique challenges faced by CPAs. Kristen Rampe will share how knowing the keys to structuring and executing a successful project can make the difference between success and repeated failures.