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IRS Free File: Do Your Taxes for Free

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Re: IRS Free File: Do Your Taxes for Free

#211

Post by linsomniac »

gavinhoward wrote: post #133
linsomniac wrote: post #132

Earlier quoted context omitted.

Used it last year and liked it, planning to use it this year. Question: How does FreeTaxUSA make money to support this?

Good question. There are two answers: state filing (which sometimes costs) and add-ons such as their "Deluxe" offering. They make money by being much smaller than TurboTax and the others. Less people means less money spent. They do this by optimizing for the easy 80% use case and letting TurboTax et al take the hard 20%.

Good to know, I think I ended up paying for both of those offerings last year to support it. I think TurboTax that I had used previously was a little smoother, but I hate their shenanigans with preventing IRS free options, etc. But, it went fairly smoothly.

Re: IRS Free File: Do Your Taxes for Free

#212

Post by aceazzameen »

tekla wrote: post #17
baby wrote: post #10

Why do I even have to do anything? Just take it from my paycheck directly

The IRS is not actually a godly being that has omniscient knowledge of every transaction that ever goes on and in the future. How is the IRS supposed to figure out how much money to take away from your W2 when you could get a billion dollar windfall at the end of the year and massively change tax bracket?

A windfall doesn't change the tax brackets for what you made in your W2 though. Each bracket is fixed for various ranges of your income. The windfall in your example would be in it's own tax bracket unaffecting everything before it. And I'm pretty sure the windfall would be reported to them too. So yeah, they would already know. Your example isn't accurate.

Re: IRS Free File: Do Your Taxes for Free

#214

Post by JadeNB »

bityard wrote: post #137
JadeNB wrote: post #67

Earlier quoted context omitted.

> They charge $14.99 for the state filing. Usually a coupon code available. Or go to the state's website (CA at least), and file that for free, too. But for the convenience of not having to input my info again, I'll pay their fee. Some states don't offer a free-file option. My memory, which is at least a few years out of date, is that MI doesn't.

IIRC, Freetaxusa will walk you through the state taxes and if you look through the UI, you can see the MI forms that it filled out. At that point, you could copy their forms to your own and mail them in yourself, but I've always paid the $15 to have them file it because I feel they've earned it.

> IIRC, Freetaxusa will walk you through the state taxes and if you look through the UI, you can see the MI forms that it filled out. At that point, you could copy their forms to your own and mail them in yourself, but I've always paid the $15 to have them file it because I feel they've earned it.

My problem has never been with the filling out the forms—my situation isn't complicated enough for that to be difficult, especially compared with the federal forms; it's with the filing. I just get so annoyed at the refusal of these agencies (like MI's, at least back when I incurred taxes there) to accept something that is surely more convenient for them and for me both, namely for me to file electronically. What do they gain by requiring me to print out and mail them a paper document that they then have to open and scan?

Re: IRS Free File: Do Your Taxes for Free

#215

Post by irowe »

marzell wrote: post #103
bmitc wrote: post #96

Earlier quoted context omitted.

FreeTaxUSA can be confusing though. It makes it quite unclear what is contributing to what portion of your tax bill. I like it better than the other more popular, mainstream options, but its usability isn't great. I never have full confidence I'm paying the correct amount or getting the correct amount as a refund.

|what is contributing to what portion of your tax bill Do you have an example of what other products provide for this? Does IRS Free File do better in this regard?

Well IRS Free File isn’t one single service. It’s a coalition of private tax prep services that have agreed with the IRS to provide their software for free to taxpayers meeting certain constraints. The insight into how your liabilities stack up certainly varies by product (I found TaxAct did this quite well, but I’ve stopped using them and started filing out the forms directly since I no longer qualify for the free file program).

Re: IRS Free File: Do Your Taxes for Free

#216

Post by anonymousnotme »

This is probably not quite the right time of year for this post. I see:

Fillable Forms is closed for the year

November 17 was the last day to access accounts, make changes, print or resubmit a rejected return. After November 17, 2022, you will not have access to your Free File Fillable Forms account and your 2021 federal tax return.

I would suspect that it will open in this next month or so. Does anybody use free file (https://www.irs.gov/filing/free-file-do-your-federal-taxes-f...)? If so, what do they think of it? Why is it better than just sending postal mail (which one has always been able to file for free)? From a security point of view, is it better to send postal mail or have to worry about hackers and filing over the net?

Also, note that there is open source software that might work for some people (depends on state and forms needed)? I found:

https://opentaxsolver.sourceforge.net/

Is there other opensource software?

Re: IRS Free File: Do Your Taxes for Free

#217

Post by irowe »

bscphil wrote: post #92
sublinear wrote: post #12

Earlier quoted context omitted.

No offense intended, but my taxes must be a lot simpler than yours because I do the Free File forms in about 30 minutes every year.

Moreover, just a few years ago I was in a position where none of the free services I tried would allow me to report a specific form of taxable income I received (a stipend paid by a university in the form of a reimbursement that wasn't reported as W-2). I literally spent 12+ hours on my otherwise very basic taxes just trying to navigate the interfaces for the "free" services. I ended up switching to the fillable form…

I’m so glad someone else pointed this particular case out! When I was a first year university student but still claimed as a dependent on my parents taxes, the accountant who prepared the returns wasn’t even aware that it needed to be reported, so they had to redo it. Later when I was doing taxes for myself via TaxAct, there was no way (that I could see) to accurately report that income. It also stumbled on HSA contribution limits. Both issues were easily resolved with the free fillable forms (which come with detailed, if overwhelming, instructions)

Re: IRS Free File: Do Your Taxes for Free

#218

Post by DangitBobby »

itake wrote: post #208
rwmj wrote: post #171

Earlier quoted context omitted.

Self Assessment is definitely not "20-30 minutes". Anyway what's crazy is that we have to do this at all. In normal countries the government calculates the tax you owe based on information filed by your employer, bank etc, and then sends you the bill. If you agree with it, you pay that. You are required to do no work at all unless you want to dispute the bill.

How do you track income that wasn’t from your employer? Like rent? How do you track deductions like installing a heat pump?

> dispute the bill

Re: IRS Free File: Do Your Taxes for Free

#219

Post by DangitBobby »

twoodfin wrote: post #184
maxerickson wrote: post #182

Earlier quoted context omitted.

Right, the point is that we can and should get that down to 5 minutes. It's just stupid lobbying and weird ideology to insist that the IRS stay out of the preparation business. And then once they start doing it, they can probably figure out how to do it for a larger and larger percentage of people over time (and the tax code can be adjusted to make it work better in cases where it makes sense).

I think you’re unintentionally making the weird ideologues’ point for them: The burden of taxes isn’t the 5, 10, 20, 200 minutes you spend preparing them, the burden is the taxes . Getting excited about saving taxpayers 15 minutes, and trading off $thousands of deductions for a few more minutes, suggests that you’re optimizing for obscuring the primary burden (the cost of government) rather than reducing it. It’s the…

It is both the time and the taxes that are a burden. And there's always gonna be some people out there keeping track of all the dumb shit we are being taxed for but not changing it, just like today.

Re: IRS Free File: Do Your Taxes for Free

#220

Post by mindslight »

robertoandred wrote: post #149
mindslight wrote: post #13

This reminds me it's time to start looking for the TurboTax torrent. The activation scheme is remarkably straightforward to crack yourself.

Submitting your most sensitive financial information into a cracked and pirated piece of software…

... that has no Internet access, and never will. I print the outputs and mail them. With the price of certified mail it would probably cost less to pay for software to e-file, however ...

In my estimation, one simply cannot trust proprietary software. They'll advertise trust and serving your interests on the front end, and then flip your information to the surveillance economy on the back end regardless. The more you try to avoid it, the more valuable your data becomes. Webapps have led the charge, but proprietary desktop software has the same dynamic now that Internet access can be taken for granted. Without a general privacy law like the GDPR, there is little downside to them doing this - the only risk is that they get caught by an independent researcher, and lose the few customers who notice and care enough. Essentially, since there is no political will for privacy regulation we're left with a low-trust relationship. And since I've got to spend effort protecting myself from the law of the information jungle, I might as well embrace it.

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