You may be one of millions of taxpayers who will be able to prepare and file their 2002 federal tax returns electronically this year — for free.

The IRS and the Free File Alliance, LLC, a private-sector consortium of tax software companies, have formed a partnership to help taxpayers electronically prepare and file their federal tax returns for free. Each Free File Alliance member sets taxpayer eligibility requirements for its program, and the requirements will differ from company to company. Generally, eligibility will be based on factors such as age, adjusted gross income, state residency, military status or eligibility to file a Form 1040EZ or for the Earned Income Tax Credit. Not all taxpayers will be eligible for these free services.

Filing electronically is fast and secure. People who file electronically generally get their refunds more quickly than those who file paper returns. The software eliminates most common errors, such as math errors, that can hold up a refund. And you get an acknowledgment of receipt of your electronically filed return by the IRS. Last year, about 47 million taxpayers filed their tax returns electronically.

Anybody who wishes to check into free filing should take the following steps:

LOCATE THE FREE FILE WEB PAGE
Go to the IRS Web site at www.irs.gov. At the IRS.gov homepage, you will be able to link to the Free File Web page that lists the Free File Alliance members and their free services.

DETERMINE ELIGIBILITY
At the Free File homepage, you can browse the summary of each Alliance member’s offering or use the Free File Wizard, a questionnaire which helps match your circumstances with companies’ services. Each Alliance member identifies their company name and has a simple description of the criteria for using their free service. Each Alliance member’s company or product name is linked to additional information about the company and its services. The Wizard will seek to match you to those Free File Alliance members for whose services you may qualify. The accuracy of results is dependent on the accuracy of the information that you provide.

LINK TO FREE SERVICES
Upon determining eligibility, you can link directly to that Alliance member’s free service by clicking on the Alliance member’s “Start Now” link (you will be notified that you are leaving the IRS.gov Web site and are entering an Alliance member’s Web site).

PREPARE AND FILE TAX RETURN
At the Alliance member’s Web site, you can prepare your tax return using the member’s online proprietary software. Completed tax returns will be sent electronically from the Alliance member to the IRS through IRS’s existing e-file system using secure telephone lines. You will receive an acknowledgement of receipt or rejection of their return via an e-mail from the Alliance member.

For more information on free filing, check out the IRS Web site, IRS.gov. For more on electronic filing, see previously issued Tax Tip number 10, “E-file Helps Refunds, Payments,” on IRS.gov.

Note: These tips are provided to help trigger ideas on ways to minimize your tax burden, not as a substitute for professional advice. There is no "one-size-fits-all" answer - each taxpayer's situation is different. You should contact your tax preparer to determine together how this may affect your unique situation.