In October of 2005, the IRS and tax software companies reached a new four year partnership agreement for free filing of taxes online. The new Free File Alliance agreement continues to offer free Federal tax filing to those us taxpayers who have an adjusted gross income of $52.000 or less. This amount will vary among the tax software partners.
Why is the Internal Revenue doing this?
- The IRS has a goal of 80% of all Federal tax returns to be filed online by the year 2007. Currently over 70 million tax payers are filing their taxes online.
- The Federal Government believes that electronic tax preparation provides a more correct way of preparing and filing taxes.
- The Federal Government also believes that a partnership with existing tax software companies will provide the best service to us taxpayers.
The Free File Alliance provides free federal tax filing and preparation at no cost to those who qualify.
- If your (AGI)adjusted gross income is less than $52.000 or,
- You qualify for the earned income credit (EIC) for tax year 2006, then you qualify for the free Federal tax filing program.
- You are an active Military, Reservist, or National Guard member whose gross income (AGI) for 2006 is less than $52.000.
2009 Federal Tax Deduction
Tax deductions are approved to an individual or a business entity to encourage positive initiatives such as charity and donations, investments, education, and environmental safety. The United States government is known for its huge number of federal tax deductions. Apart from these federal tax deductions, the citizens can benefit from the benefits of additional deductions implemented by their state governments. Apart from the standard tax deduction, a payer may be eligible for additional deduction in case of age or blindness. Married couples having joint tax filing are not eligible for tax deductions if their income crosses a certain amount.