Free e-filing for 2001 Taxes? 39
chipperdog asks: "I know this gets asked every year about this time, but
are there any free alternatives for e-filing tax returns? In previous years,
HD Vest offered free filing, but has
discontinued it this year. I can't justify spending more than $10 for filing a
return that I can send through the post office and IRS data entry people for
approx $0.50-0.75. It would be nice if the IRS would just publish a standard
submission format, so open source developers can work with it.."
Would be nice... sort of already tried... (Score:4, Interesting)
Nonetheless, what is proposed might be possible. I worked at an govt. agency in 1995/6 that developed a web interface to allow filing of EZ1040's and 1040a's and from some popular tax programs. We tested end-to-end - from a browser and a tax product into IRS's mainframe systems. Total cost was something like $30 million.
The project was killed by Congress, specifically by Congressman Ted Stevens. He used GAO to nitpik the system to dealth on technical details (PKI wasn't really around back then) and rapid development/procurement practices used by the project. The GAO Report is here [gao.gov]. But hell, we did it in six months!
I think IRS is still gun shy on the issue.
Re:Would be nice... sort of already tried... (Score:3, Interesting)
I think the nitpicking might have had something to do with the fact that the IRS and the tax preparation and electronic filing/refund anticipation loan people have a symbiotic relationship. And the industry has lobbyists on the hill. A Federal representative at a PKI briefing (back when the Federal government was a bit hotter on the idea) had said that there will never be free electronic filing available to the public, because they are reluctant to put Intuit, HRB, et al, out of business--and that if they feared being put out of business, they would be reluctant to innvotate with Treasury.
Re:Would be nice... sort of already tried... (Score:2)
This is definitely a step in the right direction. If enough states do this, Uncle Sam probably would be more apt to do free filing.
Ian
Re:Would be nice... sort of already tried... (Score:2, Interesting)
They like to very tightly control who has access (for good reason) to send them data, both for quality control and security.
That actually makes it the perfect place for open source software, because you don't have to worry about massive numbers of people downloading and using your software for free. Tax preparation and e-filing is a service, and selling services is exactly how you make money with open source software.
Specs & Info (Score:5, Informative)
and here [irs.gov] is the "IRS e-file Technical Publications" page which has the e-file file layout spec.
Re:Specs & Info (Score:4, Insightful)
Re:Specs & Info (Score:4, Insightful)
Real easy. Allow things like the AMT to filter down into the middle class tax brackets, add more goofy deductions and credits, further complicate the "long-term/short-term" capital gains situation by adding an "ultra-long-term" capital gains rate, just keep patching on layer after layer of complexity to the code.
The goal is that by 2007, nobody will be capable of filing their return without the assistance of a tax preparer.
Re:Specs & Info (Score:3, Informative)
Quicken has free filling... (Score:4, Informative)
Need a Web-based solution (Score:3, Interesting)
This way, whether one prepares his taxes using a software program which then prints out the relevant forms or by filling out forms manually, filing is a simple matter of going to the website, logging in, and typing the data into the forms.
The IRS could then perform a quick check for math errors or other booboos and let the person correct them immediately. If a person is not ready to submit the forms, his information is saved, and the next time he logs in, the forms are restored to the way they were when he was last there. Clicking on the final submit button is equivalent to signing the form and sticking it in the mail.
Seriously, this seems all very do-able to me. The current efiling system where you have to pay someone $50 to do basically the same thing you could do on the web yourself sounds like a scam and a political payoff to the tax accountants.
Re:Need a Web-based solution (Score:1, Insightful)
Or just do it yourself for free using a pen and the form they mail you, less the cost of a stamp. If you can fill out an online form without needing an accountant, why can't you fill out the same form offline without an accountant? Calculators will do wonders for checking your arithmetic, too. If you have some other need for an accountant, the web form won't help you anyway.
Re:Need a Web-based solution (Score:4, Insightful)
Re:Need a Web-based solution (Score:1)
Re:Need a Web-based solution (Score:1)
They do [intuit.com]. It's even free [quicken.com] if your AGI was less than $25,000.
Re:Need a Web-based solution (Score:1)
Re:Need a Web-based solution (Score:2)
Can you imagine all those who wait till the last hour of the last day trying to connect at the same time to fill out a huge webform (that also does math with the entries)?
Another reason why web-based forms were rejected as a solution in Canada is the SW performs a bunch of verification functions; there's a couple of pages of data that accompanies SW returns that basically minimizes (or flags, which is worse from a taxpayer's perspective) cheating, fudging, etc. Without those pages, they'll reject your SW return even if you mail it in.
Finally, some returns are not eligible; they want the paper and the docs.
itax.com has free filing (Score:2, Interesting)
Brandon Tallent
Re:itax.com has free filing (Score:1)
Re:itax.com has free filing (Score:1)
Move to Canada. (Score:2, Informative)
If I recall, there were a few online offerings that were free for personal use.
Of course, this doesn't really answer your question though. Perhaps I am just bragging? It is actually a pleasant surprise to see our government do something right!
Re:Move to Canada. (Score:2)
Filing by telephone, however, has been available for a number of years (quite a bit longer than netfiling) and is free. Of course, punching all those numbers in by telephone is a bit irritating.
Re:Move to Canada. (Score:2)
"Marge, fetch me my telephone hat, it's tax filin' time ..." (obscure Simpsons reference that no one gets) [everything2.com]
Re:Move to Canada. (Score:2)
And the look on the tax auditor's face when you say "What forms? I don't have forms, I filed by telephone! Don't you have all my records?" is even better.
Re:Move to Canada. (Score:2)
Although not mandatory (an electronic copy is OK), it's a very good idea to print out your eFile return, and again you still have to keep relevant docs.
Exactly how long you have to keep them varies a bit (regulations change and some court challenges have revised the statute from time to time), but CCRA's website is reasonably helpful (considering).
Re:Move to Canada. (Score:2)
I did returns as a way to make a few extra bucks while a student, and have always used SW since Tax Year 1994 (which allows about 25 returns before you have to pay a bit more for another 25). If you used tax SW to mail in a return in TY1995, Revenue Canada sent you an invitation to eFile for tax year '96; the actual tax software didn't have to support it (I guess I was a beta tester).
Now anyone can do it, but the SW has to support it.
There have always been secure online return prep sites for free, if you bothered to look; you don't have to pay for SW.
All Canadian eFile-ing requires a 128bit browser (not a problem).
eFile is free; Revenue Canada (now CCRA) wants everybody to use it, because it saves them big bucks.
Probably the biggest reason it was easier to implement in Canada than the US is because a long-standing agreement with the provinces means that the feds manage the returns for both and pay out relevant monies to the provinces (there is usually a 1 page provincial form, but it varies). Quebec is an exception, but they always are; and it's not a big deal for SW to implement that if there's only one.
I can't imagine a lot of US states would go for this, they're kind of suspicous (at best) when it comes to state's rights and the US federal gov't, and of course some states have no income tax at all.
Telephone filing is available, but if you don't like voicemail you'll HATE telefile.
www.taxactonline.com (Score:4, Informative)
Re:www.taxactonline.com (Score:2)
Their calculations when it comes to mortgage appreciation, stock divestiture, exempt expenses, and the like....well, they suck.
I plugged my numbers that I could into both TaxAct and TaxCut last year, and TaxAct missed something like $1500 that I would have had to pay in addition to the bit of tax I already owed.
So if your income model is pretty basic, it might work fine, but if you do any serious money moving, go for one of the ones you buy.
They do have a standard format (Score:5, Interesting)
Its not just federal, though... (Score:2, Insightful)
I work at Intuit, in the back-end e-filing group, not in the consumer division (TurboTax) but for one of the CPA-grade tax products we produce (Lacerte). The stacks of IRS and state reg manuals we implement each year is enough to make you want to...
...charge people for letting them use the system you implemented.
I do believe that there's a web version of TurboTax that lets you skip the software purchase (but still requires the e-file fee). Or you can buy the software (windoze) and get a voucher for a free e-filing). Or you could STEAL the software and use the voucher!
You could watch CompUSA (Score:1)
TaxAct allows Free Paper Filing, $7.95 for e-file. (Score:1)
The software can be downloaded or used over the web.
use a spread sheet and then copy over ... (Score:2)
If you have just one employeer and no interest or less than 400 in interest and no stocks or bonds or investments, you could probably use a 1040EZ. Other wise you may need a 1040.
Even if you did use turbo tax or one of the other programs you'd have to fill out your w2 forms, and 1099 and any other forms. I'd recomend breaking down and spending the 20 or 30 for Turbo Tax if you have lots of forms especially if you recieved some of those 4000 series forms.
Personally I think the goverment and states should be required at this time to send people forms that do the computations for you. There is no reason that they cannot.
HRblock (Score:1, Informative)