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Some Massachusetts taxpayers will be able to file their state income-tax returns online, at no charge, this season.

The Massachusetts Department of Revenue today brought back its free online filing program, which was mothballed several years ago. At the same time, the agency scrapped its file-by-phone "Telefile" system.

"Effective today, most taxpayers who file basic tax returns or who have used the old Telefile system may go to the DOR website and file their income taxes conveniently, securely and at no cost using an online filing program developed by DOR," said Mass. Revenue Commissioner Navjeet K. Bal. "This service may also be used by some taxpayers who in the past have purchased software packages to file their tax returns," she said in a statement.

Telefile has been around since 1994, but its popularity has waned as computer use has spread, the agency said. In addition, Telefile technology was outdated and unable to stay current with changes in Massachusetts tax law, including the new filing requirements for health insurance, the agency said.

The online program, called "WebFile for Income," performs math calculations. And if a taxpayer is interrupted or otherwise cannot complete a return while using the program, the program saves the work and makes it available for later retrieval. The program also tracks refunds and payments.

When a return is completed, the WebFile program provides the taxpayer with a printable receipt to confirm that their information was successfully received by DOR. Taxpayers may log into their accounts to view a printable summary or view detail of the tax data submitted.

Not everyone is eligible, however. For example, you generally cannot use the new system if you fall into any of the following categories for 2008:

• You were not a resident of Massachusetts for the entire year.
  
• You were self-employed.
  
• You had income from rents, royalties, partnerships or S corporations.
  
• You had interest, dividends or capital gains or capital losses. (However, if your only interest is from a Massachusetts bank, you may still be eligible to use the program.)
  
• You claim the "senior circuit breaker tax credit," a property-tax break.
  

  The IRS later this week is to present details about its Free File program, which generally lets certain taxpayers prepare and file their federal returns online at no charge. Free File is not offered directly by the IRS. Instead, the IRS's Web site serves as a portal through which taxpayers may choose a free tax preparation program offered mainly by software preparation firms. One criticism of Free File is that it allows for the free preparation and electronic filing of federal returns, but not of state returns. Vendors typically charge more for state returns.

  

   Tags  DOR Massachusetts Massachusetts Department of Revenue Neil Downing state income tax Telefile WebFile

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