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Tax Tip: Preparing and Filing Your Taxes for Free

iStockphoto/Thinkstock(NEW YORK) -- The majority of U.S. taxpayers are eligible to have their tax returns filed for free, which begs the question: Why pay money for for tax preparation software?

"If your income is about $57,000 or less, there's a good chance you can qualify to file your return electronically and do it for free," explains Eric Smith with the IRS. "That profile fits about 70 percent of American taxpayers."

The IRS offers a service called Free File that uses brand name tax preparation software. Taxpayers choose which program they want to use, then follow the instructions.

"You enter information from W-2s and 1099s, but you also answer questions that can help the program help you determine which deductions and credits you qualify for," Smith says.

Depending on the state you live in, you might also get Free File to do your state taxes, as well.

And taxpayers seem to like it. The IRS says 98 percent of people who use Free File would recommend it to a friend. 

Copyright 2012 ABC News Radio

ABC News Radio