Tax season is here, and many taxpayers are wondering if they can file their taxes for free. The good news is that those with adjusted gross incomes (AGIs) of $79,000 or less are eligible to file their federal returns for free through IRS Free File.
It’s important to understand that your AGI might not be the same as your earned income from your job. Your AGI is usually a lower number, which is beneficial for taxpayers seeking free tax filing. According to the Internal Revenue Service (IRS), AGI is calculated by subtracting adjustments to income from gross income.
Your gross income includes various types of income, such as wages, tips, dividends, capital gains, business income, rental income, and retirement distributions. On the other hand, adjustments to income are items you can deduct or exclude from your gross income. These may include contributions to certain retirement accounts, paid student loan interest, education expenses, and more.
To determine your AGI, add up your adjustments to income and subtract that total from your gross income. This calculation will give you the figure you need to know if you are eligible for free tax filing.
Free File, a program provided by the IRS, opened on January 12th. Taxpayers can start filing their returns on January 29th, the official start of the tax filing season.
The IRS has partnered with several companies for the Free File program. These companies offer free tax filing services to eligible taxpayers. By taking advantage of Free File, individuals can save money on tax preparation fees and potentially receive their refunds more quickly.
Filing taxes can be a complex process, but understanding AGI and utilizing the Free File program can simplify the task and save taxpayers money. Take advantage of this opportunity if your AGI is $79,000 or less, and ensure you accurately calculate your AGI by considering both your gross income and adjustments to income.
Remember, the deadline for filing federal tax returns is April 15th, so don’t wait until the last minute. Take advantage of the Free File program for eligible taxpayers and file your taxes for free.
