IRS Announces Free File Service Beginning Jan. 10

The IRS building in Washington. Madalina Vasiliu/The Epoch Times

The IRS will open the Free File service beginning this week.

The service “will be available Friday for taxpayers ahead of the official start of tax season later this month,” the agency said in a Jan. 7 statement. It allows taxpayers to prepare and file their federal income tax returns online for free. The IRS calls the service a “safe, easy” way to file returns. It is a public-private partnership between the tax agency and Free File Inc. (Free File Alliance), a nonprofit coalition of tax software companies.

Every partner taking part in the Free File program “guarantees the accuracy” of the tax return calculation, the agency said. Some service providers may also offer free preparation for state taxes. The IRS says that it does not endorse any of these providers.

Free File is distinct from the agency’s other service, Direct File. While the former is a partnership initiative between the IRS and tax service providers, Direct File is offered by the tax agency directly.

Even though Free File allows taxpayers to prepare their returns from Jan. 10, the documents can only be submitted when the filing date officially begins.

In total, eight partners have joined with the IRS to provide the service in the 2025 filing season.

“Each IRS Free File trusted partner establishes its own eligibility criteria based on age, income, state residency, and military status,” the agency said.

The service is available for taxpayers with an adjusted gross income (AGI) of $84,000 or less in tax year 2024. AGI is the total annual income minus certain deductions such as student loan interest and certain IRA contributions.

Free File 2025 is being offered by 1040Now, Drake (1040.com), ezTaxReturn.com, FileYourTaxes.com, On-Line Taxes, TaxAct, TaxHawk (FreeTaxUSA), and TaxSlayer.

Free File is also a “no-cost way” for taxpayers to claim valuable tax credits such as the Earned Income Tax Credit or the Child Tax Credit, the agency said.

“The IRS remains committed to its partnership with Free File Inc. to ensure taxpayers have free and secure options for filing their taxes electronically,” said IRS Commissioner Danny Werfel.

This is the 23rd filing season for IRS Free File.

For taxpayers with incomes above $84,000, the IRS offers the Free File Fillable Forms—electronic versions of the agency’s tax forms. These are expected to be available beginning Jan. 27 and are ideal for taxpayers who prepare their own returns.

Free File Versus Direct File

In addition to IRS Free File, taxpayers have access to the Direct File tool to file their returns in the 2025 season.

Direct File was run as a pilot in the 2024 filing season. At the time, more than 140,000 taxpayers in 12 states used the tool. The IRS later announced that Direct File is set to become a permanent option to file federal returns beginning this season.

For 2025, Direct File is expected to be available across 24 states, with the agency estimating that more than 30 million taxpayers will be qualified to use the service.

To avail of the Free File service, a taxpayer must visit the IRS website that lists out the entities offering free filing of returns. These entities ask several questions regarding taxes in order to prepare and submit returns to the IRS.

“You won’t get the free service if you go directly to a company’s website,” the agency said.

As for data safety, the IRS says partner entities “may not disclose or use tax return information for purposes other than tax return preparation without your informed and voluntary consent.” The service providers are subject to privacy and safeguard rules under the Federal Trade Commission.

A 2022 report from the Government Accountability Office (GAO) found that many entities partnered in the Free File initiative advertised their services outside the program.

“Participating companies do not have an incentive to direct taxpayers to IRS Free File, in lieu of their own services,” GAO said.

The tax agency had agreed it wouldn’t develop its own filing services while the entities provided free filing via the Free File program, GAO said. But in 2019, “IRS was no longer prohibited from developing its own online filing service.”

With the launch of the Direct File service, the IRS currently offers a filing option to taxpayers without having to go through the intermediaries.

However, Direct File has also come under criticism. Last month, 29 House Republicans wrote a letter to President-elect Donald Trump asking him to end Direct File on his first day in office, saying it was wasteful and posed a threat to American freedoms.