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IRS Direct File Pilot, Now Open 24/7, May Be Expanded After Tax Season

By:
S.J. Steinhardt
Published Date:
Mar 18, 2024

The IRS’s free Direct File pilot program, which is now open round the clock to eligible taxpayers in 12 states, has already been used by 20,000 taxpayers, and administration officials hope it will reach 100,000 this year as they consider future expansions, The Wall Street Journal reported.

The Treasury Department estimated that up to 19 million taxpayers are eligible for Direct File this year, based on where they live and how simple their returns are. "This includes 5.2 million in California, 3.8 million in Texas, 2.8 million in New York, and 2.4 million in Florida, and 1.1 million in Washington," Treasury stated.

“Direct File will offer millions of Americans a free and simple way to file their taxes, with no expensive and unnecessary filing fees and no upselling,” said Lael Brainard, director of President Biden’s National Economic Council. 

IRS Commissioner Danny Werfel said that the results of Direct File have been positive so far, but he didn't go as far as announcing a future expansion. Instead, he said he planned to discuss the issue with the public and Congress after the filing season, the Journal reported. “We have an important next four to five weeks” ahead, he said.

Expanding Direct File would require two types of changes: One would let the system accept more complex tax returns, and another would require coordinating with more states with broad-based income taxes.

Senior administration officials told the Journal that Direct File users have required less customer support so far than they had expected, a big unknown before the launch. 

Sen. Elizabeth Warren (D-Mass.) praised the program as an example of the Biden administration cutting “junk fees.” But Rep. Jason Smith (R-Mo.), chairman of the House Ways and Means Committee, said Direct File was unnecessary and that IRS officials have been unable to provide information about the overall cost of the program.

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