Intuit, the developer of tax filing software Turbotax is no longer a participant in the IRS File Alliance. IRS and Intuit have been in a partnership that ensures free TurboTax edition software to Americans earning less or equal to $72,000.
Why is Intuit not a part of the IRS Free File Program?
When asked the reason, Intuit tells “limitations of the Free File program”. The company wants to focus more on innovative ideas that do not fall short under the parameters of the Free File program. As per the agreement, participating companies are denied to market paid products to those using this program. That’s why they want to put an end to this deal. As Intuit is one of the parts there, so does not want to limit its users with specific boundaries only. Therefore, it goes further and helps customers to increase their incomes.
The company wants to focus more on pilot programs. It wants to assist its users and clients to enhance savings through saving money, paying off debt, and increasing their income. While interviewing one of the spokespeople of Intuit, we get to know that the company continues to provide free tax preparation but only through ways that address all kinds of financial problems of a user.
They add more and articulate that the company continues to provide the availability of TurboTax free edition to 50 million people and more. Also, add some other beneficial things that will help the users worldwide.
What is Free Filling Alliance?
The Free File program provides a platform for various software programs to prepare the taxes for Americans. The taxpayers should be eligible enough to use the software. The user can pick any of the software that makes its filers key tax questions, does the maths, and makes you able to file returns.
Paper returns will take more time than e-filing to do the IRS process returns and issue refunds. Turbotax was a partner at this platform. Instead of TurboTax, you can pick any other platform for e-filing your taxes. Make sure to not pick the same software in the upcoming year. For example, if you choose TurboTax this year then pick another online service next year.
Intuit has been a member of the Free Filling Alliance for almost two decades. While being a part of Free File Alliance, Intuit along with H & R Block has influenced Congress to prevent the IRS from building a free tax filing system.
However, the members articulate that they will face a big competitive threat when arguing with the IRS. Also, it could bring material and revenue implications. Then, in April 2019, they took the relief with the passing of the Taxpayer First Act. According to this act, the IRS has no right to build its system.
Who qualifies for Free File?
Anyone with $72,000 gross income or less in 2021 can use the free tax software to make the tax return. However, if income is more than you would be provided access to Free File forms also.
It is estimated that 70% of taxpayers are qualified to use the free software service. But, only a few qualified use the Free File. That means many people do not prefer its time-consuming tactics to use the software.
The service works only for the people who are willing to file a simple tax return. You can find two options there. The first one provides you access to an expert that will resolve your queries. The service would end on March 31st. While the other option, full service brings the user closer to a professional that creates their taxes. Feb 15 is considered the deadline.
If Free Turbotax Edition is still there then what has changed?
Turbo Tax has made an alliance with the IRS to help the taxpayers. However, they face limitations there. Also, the plan they had formed in their minds is not possible under IRS free file rules. Therefore, Intuit has developed its TurboTax free editions which are different from IRS defines.
One of the spokespersons of TurboTax has articulated that these programs are quite similar but not the Turbotax free edition allows us to provide the filers with free of charge advance on the refund. This will help in paying the bills if the user wants money faster.
Make sure that the deadline for filing the taxes is April 18.
Who can use TurboTax Free Edition’s free services?
Turbo tax-free services can be easily received if you cover:
- Child tax credits
- Student loan interest deductions
- W-2 income
- Earned Income Tax credit (EIC)
- Limited interest and dividend income reported on a 1099-DIV
- Claiming the standard deduction
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Who Can’t Use the free TurboTax Edition?
All users who have:
- Stock sales
- Education express
- Income from rental property
- Itemized deductions (like mortgage and property deductions)
- Credits, Income, and deduction reported on schedules 1-3
- Charitable donations
- Business or 1099-NEC income
- Unemployment income reported on a 1099-G
Clearly, this is how the Turbo Tax-free edition has evolved from the IRS free file software services. You can now pick Turbotax each year without limiting yourself to the IRS guidelines. Intuit does not want to limit its readers. That’s why it bid goodbye to the IRS. We hope that you have understood the information provided above. However, if you want to ask further then let us know in the comment section.