The United States Internal Revenue Service (IRS) will allow multiple users in some states to file tax returns without any costs or intermediaries. This decision is part of an experimental program called IRS Direct File that will begin in January next year.
The proposal will be available for 13 states, including Arizona, California, Massachusetts and New York. The four states mentioned will have the opportunity to comply with state and federal obligations through the new tax route.
The remaining states are Alaska, Florida, New Hampshire, Nevada, South Dakota, Tennessee, Texas, Washington and Wyoming. These nine states do not have to pay state taxes and therefore only care about national taxes.
The operations that are allowed
This tool can be used by people with certain incomes, e.g. B. from employees, W-2 documents and social security contributions. In addition, railroad retirement benefits, unemployment benefits, and investment interest up to $1,500.00 can be claimed.
Other processes that may be carried out include applications for child tax credits, earned income and other dependents. Deductions that must be taken include standard deductions, student loan payments, and teacher expenses.
The IRS reported that the tool can be interacted with from a desktop computer, tablets or mobile phones in English and Spanish. The government agency reported that IRS Direct File will not replace commercial software or Free File.
The VITA Volunteer Program and the TCE Elders Program remain active. With the initiative, the IRS offers a free way to respond to citizen complaints about companies implementing tax software. These companies make huge profits by collecting taxes from taxpayers.