IRS Free File

IRS Free File is a program under which participating tax software companies provide free federal tax preparation and electronic filing to taxpayers whose adjusted gross income falls below an annual limit. Treasury describes the arrangement as "a public-private partnership between the IRS and Free File, Inc. (FFI), a tax-exempt section 501(c)(4) social welfare organization." The IRS's own consumer page uses the older name, describing the partner as "the Free File Alliance, a coalition of tax preparation software companies"; Treasury's report notes that "Free File, Inc. is the successor to the Free File Alliance, the original partner," so both names are in current government use and refer to the same partnership. The program first launched for the 2003 filing season.

The name is worth getting exactly right, because two different things are offered under it. Guided Tax Software is the commercial software with an income limit, described by the IRS with the phrase "let the software do the work." Free File Fillable Forms is the other product: electronic versions of the paper forms with no income limit, no interview, no guidance and no state filing, described as "you do the work." They are routinely conflated, and the difference decides whether a filer gets help or just a screen.

The income limit is contractual, which explains its otherwise puzzling behavior. No statute sets it. The terms of the program are governed by a memorandum of understanding between the IRS and the partner organization, and Treasury records what that document does: the memorandum "sets an annual income limit intended to make approximately 70 percent of taxpayers eligible to use Free File to file their federal income tax return." Two consequences follow that matter to anyone checking eligibility. The figure moves on a filing-season cadence rather than a tax-year one, so it will not be found in a revenue procedure alongside the year's contribution limits and bracket thresholds. And because it is set by reference to a coverage target rather than to an inflation index, it can move by an unfamiliar amount from one season to the next. The current figure is published on the IRS Free File page on IRS.gov each season.

The agreement has a term, and it runs into the next decade. Treasury's October 2025 report records that the program operates under the Ninth Memorandum of Understanding on Service Standards and Disputes, and that "An April 30, 2024, Amendment to the Ninth Memorandum of Understanding extended the terms of the ninth MOU to October 31, 2029." That is the durable fact behind questions about whether the program is going away. It is under contract for several more filing seasons.

Three things a first-time user should know before starting. The first is the entry point. The IRS is unambiguous: "always go through the IRS.gov site to access the IRS Free File tax preparation software. You won't get IRS Free File if you go directly to a partner's commercial website." The same company's ordinary product, reached by its own front door, is a paid product. Second, each provider may set its own additional criteria on top of the income limit, such as age limits, military status, or a lower income cutoff of its own, though collectively the providers must make at least one federal return option available to every eligible taxpayer. The IRS tool on the entry page matches filers to providers on those criteria. Third, state returns are not covered the way federal returns are: state coverage is required only in states that participate in a State Free File Program, and where a provider offers a state return the income limits or scope restrictions may be tighter than the federal ones. Treasury notes this is why some users perceive that the program is "not truly free."

What providers may not do is the part that makes it a genuine free offering. Treasury records that although providers may charge for state filing, "they are prohibited from charging for add-on services or engaging in other sales activity," and that they "are barred from offering other services to Free File users beyond federal and state return preparation and submission." That restriction is what separates the program from a free tier that exists to upgrade the customer partway through.

Take-up is a small fraction of eligibility, which is the most striking number in the program's history. For tax year 2024, Treasury estimated that approximately 98 million tax units were eligible to use Free File, while about 2.7 million returns had been filed through it as of August 1, 2025. That is under 3% of those eligible. Neither the filer nor the federal government pays for the software, so the gap is a question about awareness and entry point rather than about cost. (The count of participating companies is not fixed; eight took part as of Treasury's October 2025 report, and the current list is on the IRS Free File page.)

The sequence is short, and the first step is the one that determines whether it costs anything.

1. Start at the IRS Free File page on IRS.gov. Not at a search result, and not at a software company's own site. This is the step that distinguishes the free product from the same company's paid one.

2. Check the income limit for the season, which is stated on that page and applies to adjusted gross income.

3. Use the IRS matching tool, which matches filers to participating providers on eligibility factors including filing status, income, earned income tax credit eligibility, age, military status, and whether a state return is needed. Providers may have their own additional criteria, so not every eligible filer can use every provider.

4. Prepare and file the federal return in the provider's software, which interviews the filer and does the arithmetic.

5. Deal with the state return separately. It may be included, it may cost money, or the provider may not offer one at all.

If your income is above the limit, Free File Fillable Forms is available at any income level. It is electronic paper: the forms with the arithmetic done and nothing else. There is no interview, no eligibility screening, and no state filing, so it suits someone who knows which forms their situation needs and would otherwise be filing on paper.

A worked check on scale, using Treasury's own figures for tax year 2024. Roughly 2.7 million returns filed through the program against approximately 98 million eligible tax units is 2.7 ÷ 98, or about 2.8%. Put the other way round, more than 95 million households that could have filed a federal return at no cost did not use the program to do it.

What is genuinely good about it

• The federal return costs nothing, to the filer or to the Treasury, and the software is the same commercial software sold elsewhere.
• Providers are barred from selling add-on services to Free File users, so the free product is not a funnel into a paid one.
• The eligibility limit is set to reach roughly 70% of taxpayers, so it is a mainstream option rather than a narrow hardship program.
• Fillable Forms gives a no-cost electronic route to anyone at any income, which is a meaningful improvement over filing on paper.
• The program is under a memorandum of understanding running to 31 October 2029, so it is not season-to-season.

The honest limitations

• Reaching it through anything other than IRS.gov generally lands the filer in a paid product, and the mistake is easy to make and hard to undo mid-return.
• State returns may cost money, and state coverage is required only where a state participates in a State Free File Program.
• Each provider sets extra criteria, so eligibility on income alone does not mean eligibility for the provider you would have chosen.
• Fillable Forms provides no guidance, no state filing and no eligibility checking, so it is unsuitable for anyone who is not already confident about which forms apply.
• Take-up is a small share of eligibility, which suggests that finding the program is a real obstacle rather than a theoretical one.