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Tax season opens Monday, and the Internal Revenue Service has announced that it has expanded its free online system for filing 2024 returns directly with the federal government.The Direct File option was initially offered in a dozen states last year to low- and moderate-income taxpayers with simple returns.The trial went well, with most filers giving it high marks.The agency said it would expand the program this year, making it available to millions of taxpayers in 13 more states and adding features to cover more tax situations.Whether Direct File continues beyond this year, however, remains to be seen.
The offering has faced opposition from commercial tax-preparation software firms and from Republican members of Congress, who last month urged then-President-elect Donald J.Trump to end what they called the “unauthorized and wasteful” program.
(The I.R.S.was tasked with exploring a free direct-filing option as part of the Inflation Reduction Act of 2022, the wide-ranging law championed by Democrats and the Biden administration.)Scott Bessent, President Trump’s nominee for secretary of the Treasury Department, which oversees the I.R.S., pledged at his confirmation hearing before the Senate Finance Committee this month that if he were confirmed, Direct File would operate for this year’s tax season.
He said he would then “study” the program.The I.R.S.accepted more than 140,000 Direct File returns last year.
Most were from single filers.Their average age was 33, their average income was $44,000 and a quarter had income under federal poverty guidelines, the I.R.S.
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