A trial program has been initiated by the Internal Revenue Service (IRS) and Arizona is participating in it. The new program will allow Arizonians to submit their taxes electronically at no cost in the coming year.
Taxpayers now have the option of using the IRS’ own platform to file their taxes, as opposed to relying on a third-party program such as TurboTax or H&R Block, thanks to a pilot program.
It is important to be aware of the new program and who is eligible to take advantage of free filing in the following year.
What is the purpose of this free tax program?
Beginning in 2024, the state Department of Revenue has created a Direct File pilot program that allows taxpayers to file their federal returns electronically for free through a government website. This program is expected to include a Q&A-based program to assist users in preparing their tax forms.
Why is the state of Arizona included?
Residents of Arizona can take advantage of the pilot program that offers free filing of state returns using government software. This is due to the fact that the state is one of four that imposes an income tax.
The Arizona Department of Revenue works to make the experience for taxpayers easier and smoother. Joining a pilot program that is currently in place at the federal level will bring a benefit to those they serve.
Is it possible to submit AZ state taxes at no cost?
Once the launch takes place, the answer is yes.
Code for America, a technology-based nonprofit, is collaborating with the Department of Revenue to construct a software that will enable individuals to submit their state tax returns at no cost.
The Department of Revenue has announced that people in Arizona who utilize the IRS Direct File program for submitting their federal returns will be able to connect directly to the state’s platform that is in the process of being built.
What are the qualifications for taking advantage of the new free filing method?
The Arizona Department of Revenue has mandated that in order to file taxes without charge in the upcoming year, an individual should fulfill the following:
- Residents of Arizona who don’t generate income from any other state can be eligible to receive the Earned Income Tax Credit, Child Tax Credit, or Credit for Other Dependents.
- The only sources of income that are applicable are wages, Social Security benefits, unemployment benefits, and interest up to $1,500.
- Self-employment income, such contract work, will not be accepted.
- The Premium Tax Credit, the Child and Dependent Care Credit, the American Opportunity Tax Credit, and other educational credits are not applicable.
Complying with the 2022 Inflation Reduction Act mandated the use of a free, direct-file tax program, as declared by the IRS. The law, signed by President Biden, allocated funds to the IRS for enhancing performance and enforcement.
Individuals are still waiting for the IRS to designate a website where they can file their taxes. On the IRS website IRS.gov/directfile, you can find general information about this process.