The number of people using the Internal Revenue Service (IRS)-produced Free File guided tax software increased by 9.7 percent in this filing season until February 24, compared to the same date in 2023, according to the federal agency.
In the filing year up to February 24, 943,000 taxpayers submitted their tax returns via IRS Free File, an increase on the 860,000 who did so during the same period in the 2022-23 fiscal year.
IRS Free File software is now in its 22nd season and is available to any taxpayer who recorded an Adjusted Gross Income (AGI) of $79,000 or less during 2023. Those earning more than $79,000 can use the IRS's Free File fillable forms, though the agency says that this is "best for people comfortable using IRS form instructions and publications when preparing their own taxes."
An update published by the IRS on March 1 said that the agency sent out 28.9 million refunds to taxpayers during the 2024 filing season through to February 24, coming to a total of $92.9 billion. The average refund payment was $3,213, up 4.3 percent from the previous year.
IRS Free File is a public-private partnership under which "tax preparation and filing software providers make their online products available to eligible taxpayers." This year, eight "private sector Free File partners" are providing online tax guidance software, according to the agency. This can be accessed by visiting IRS.gov/freefile.
The eight partners participating in the Free File scheme this year are: 1040Now, Drake (1040.com), ezTaxReturn.com, FileYourTaxes.com, On-Line Taxes, TaxAct, TaxHawk (FreeTaxUSA) and TaxSlayer. An IRS-endorsed Free File package is also available in Spanish from ezTaxReturn.com.
The IRS is launching a pilot scheme, called Direct File, which provides a free system for taxes to be paid by American workers. Speaking to news website Vox, Treasury spokesperson Ashley Schapitl said 19 million taxpayers across the U.S. will be eligible to use the new scheme in the 2024 tax season, and the government is expecting "at least several hundred thousand" people to participate.
On February 27, the IRS began sending tax-refund returns for the 2024 tax year, with thousands of Americans believed to be eligible for an extra stimulus check. Those who qualify for IRS Earned Income Tax Credit (EITC), which is given to individuals and families on low- to moderate-income levels, can claim up to $7,430 as an effective tax break.
The Center on Budget and Policy Priorities, a progressive think tank, estimated that, in 2018 alone, the EITC lifted around 5.6 million people over the poverty line.
In a press release published on February 29, the IRS said that it is launching a major crackdown on high-earners who have failed to file tax returns over the past few years.
The agency will issue non-compliance notices to those earning more than $400,000 a year who didn't file federal income tax returns during the period from 2017 to 2021, with 125,000 suspected cases identified.
In the press release, the IRS said it wasn't sure exactly how much money the federal government is owed at this stage but estimated it is owed "hundreds of millions of dollars of unpaid taxes."
Uncommon Knowledge
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Newsweek is committed to challenging conventional wisdom and finding connections in the search for common ground.
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James Bickerton is a Newsweek U.S. News reporter based in London, U.K. His focus is covering U.S. politics and world ... Read more
