The IRS and the Free File Alliance, a consortium of 17 tax preparation software companies, launched the Free File program on Jan. 16. The private sector agreed to make available free tax preparation and e-filing to at least 60 percent of the nation’s taxpayers, and the IRS agreed to host the Free File page on its IRS.gov Web site.

IRS e-file also continues to post large gains among tax professionals who e-filed 27.4 million returns, a 7.6 percent increase. However, the largest gain continues to be among people who prepare their own taxes on their computers. So far, 8 million individuals, a 27.7 percent increase over 2002, had prepared and e-filed their own tax returns.

"We are extremely pleased with the performance and acceptance of Free File by the nation’s taxpayers," said Bob Wenzel, IRS Acting Commissioner. "Our intent was to form a partnership with the private sector that would pay off for taxpayers both literally and figuratively."

Altogether, the IRS has so far received 66.9 million individual returns, 38.7 million of which were filed electronically.