Yes, FreeTaxUSA offers an option to deduct tax preparation fees (for state returns or deluxe upgrades) directly from your federal refund for a $24.99 processing fee. This service, managed by a third-party bank (TPG), is optional, and you can avoid it by paying with a credit/debit card upfront.
There aren't many hidden costs or upgrades with FreeTaxUSA but there are a few options that cost extra: Audit defense support: Costs an extra $19.99. Pay filing fees with your refund: $24.99. Pay taxes with credit card: 2.5% of total due.
If you owe back taxes, the IRS will take all your refunds to pay your tax bill, until it's paid off. The IRS will take your refund even if you're in a payment plan (called an installment agreement).
Direct deposit
Get your refund electronically deposited into your bank account.
The main cons of FreeTaxUSA are its basic interface requiring more user knowledge, lack of direct document import (manual entry needed), no true "free" option for complex returns (states cost extra, and some features are paid), and limited free support, though paid options exist, making it less ideal for complex situations or those needing hand-holding compared to premium software.
There is no income limit on FreeTaxUSA. See the IRS FreeFile program for limits, not FreeTaxUSA.
FreeTaxUSA is a great alternative to high priced tax software such as TurboTax and H&R Block. Easy to use and a fraction of the cost of the other alternatives. Filed electronically and had my returns in 2 weeks. Highly recommend.
Guaranteed 100% accurate
We check for errors as you go. All calculations are guaranteed accurate.
If your refund exceeds your total balance due on all outstanding tax liabilities including accruals, you'll receive a refund of the excess unless you owe certain other past-due amounts, such as state income tax, child support, a student loan, or other federal nontax obligations which are offset against any refund.
Where's My Refund has the latest information on your return. If you don't have internet, call the automated refund hotline at 800-829-1954 for a current-year refund or 866-464-2050 for an amended return.
Information privacy. We do not collect or sell data from the information on your tax return. That information is always kept confidential between you and the IRS.
All major tax situations are supported for free
FreeTaxUSA supports over 350 credits and deductions. Our free federal service includes basic, premium, and self-employed tax forms.
To avoid the 22% tax bracket (or any higher bracket), focus on reducing your taxable income through strategies like maxing out 401(k)s and HSAs, deferring bonuses, tax-loss harvesting, smart charitable giving, and strategic asset location, understanding that higher rates only apply to income within that bracket, not your entire income.
The "20k rule" refers to the traditional IRS threshold for reporting income from payment apps and online marketplaces on Form 1099-K: over $20,000 in gross payments AND more than 200 transactions in a calendar year. While a law (the American Rescue Plan) temporarily lowered the threshold to $600, recent legislation, the One Big Beautiful Bill Act (OBBBA) (OBBBA), has reinstated the $20,000/200-transaction rule for tax years starting in 2025, providing relief for casual sellers and gig workers.
Free federal and state filing
For anyone with an AGI under $51,000. If you don't qualify, your federal return is free and state filing is $15.99.
When can I expect my California tax refund? If you e-file, it can take up to three weeks to receive your refund. For paper filers, it can take up to three months to receive your refund.
TaxHawk, Inc., owner of FreeTaxUSA.com, was founded in 2001 and is an authorized IRS e-file provider. Their online tax software is designed for self-prepared tax returns.