If you qualify for the Free Edition, both your Federal and State returns should be Free. However, if you have a situation that required you to upgrade to another product like Deluxe or above, you will need to pay for your state return. You can file with TurboTax Free Edition if you use form 1040 with no attached schedules, but will need to upgrade to a different product if your tax situation this year falls outside of these situations.
Simple tax situations covered in TurboTax Free Edition:
• W-2 income
• Limited interest and dividend income reported on a 1099-INT or 1099-DIV
• Claiming the standard deduction
• Earned Income Tax Credit (EIC)
• Child tax credits
Situations not covered in TurboTax Free Edition include:
• Itemized deductions
• Business or 1099-MISC income
• Stock sales
• Rental property income
• Credits, deductions and income reported on schedules 1-6, such as the Student Loan Interest Deduction