Investors may be able to file taxes for free this season. Here's who qualifies – CNBC

With less than a week until tax season begins on Jan. 27, investors may have more options to file for free than in previous years.

Investors typically require specific tax forms to file their returns. 1099-B Capital gains and losses and forms 1099-DIV For distribution of dividends and capital gains. shape 1099-INT Interest income from savings accounts, certificates of deposit, Series I bonds, Treasury bills, etc. is eligible.

Additionally, retirees can receive a form 1099-R Withdrawals from 401(k) plans, individual retirement accounts, pensions, and other distributions.

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30 million people could take advantage of the IRS's free Direct File program

Depending on your situation, here are three free tax filing options to consider this season.

This season, IRS Direct File, the IRS' free filing program, has expanded to 25 states. covers more than 30 million taxpayers Across eligible states, according to U.S. Treasury estimates.

“I'm excited about the improvements to Direct File and the millions of additional taxpayers who will have access to the service this year,” former IRS Commissioner Danny Wuerffel said in an October press release.

During the 2024 pilot, the program covered simple returns, including declarations. interest Under $1,500. However, for the 2025 application season, the program Supports interest rates above $1,500 Alaska residents receiving Alaska Permanent Fund dividends.

The program currently does not cover other investment income such as capital gains or dividends.

Starting in March, Direct File will also be available. support distribution It comes from most company retirement plans, such as 401(k) plans and pensions. However, this service is not available if you withdraw funds from your IRA.

Another option is IRS Free File is a public-private partnership between the IRS and the Free File Alliance, a nonprofit alliance of tax software companies.

This season, you can use IRS Free File if: Adjusted gross incomeor AGI, was less than $84,000 in 2024.

Eight software partners accept the most commonly used Tax form and tax tablesaid Tim Hugo, executive director of the Free File Alliance. These include Schedule B for interest and ordinary dividends and Schedule D for capital gains and losses. These schedules cover investment forms such as 1099-INTs of $1,500 or more and certain items on Forms 1099-B and 1099-DIV.

“This is really a great tool that will help millions of Americans that no one knows about,” Hugo said.

If you need more guidance, you can also qualify for free tax preparation below. Volunteer income tax supportor VITA, a program administered by the IRS.

For the 2025 season, you will qualify for VITA if your adjusted gross income is $67,000 or less.

of Program scope This includes investor coverage, including Forms 1099-INT, 1099-B, and 1099-DIV, subject to certain limitations. VITA also covers Form 1099-R for retirement income, with some exceptions. Under this program, virtual currency transactions will not be covered by the 2024 application.