For eligible taxpayers, the Internal Revenue Service’s (IRS) Direct File was apparently a free and simple way to file their 2023 federal tax return. Based on that result, the IRS plans to make Direct File a permanent feature when it’s time to file 2024 returns.
The agency said it is even exploring ways to expand Direct File to make more taxpayers eligible in the 2025 filing season and beyond by examining options to broaden Direct File’s availability.
During the pilot earlier this year, 140,803 taxpayers in 12 states filed their taxes using Direct File. The IRS said it closely analyzed data collected during the pilot, held numerous meetings with diverse groups of stakeholders and gathered feedback from individual Direct File users, state officials and representatives across the tax landscape.
The IRS heard directly from hundreds of organizations across the country, more than a hundred members of Congress and from those interested in using Direct File in the future. The IRS has also heard from a limited number of stakeholders who believe the current free electronic filing options provided by third-party vendors are adequate.
“The clear message is that many taxpayers across the nation want the IRS to provide more than one no-cost option for filing electronically,” said IRS Commissioner Danny Werfel.
“So, starting with the 2025 filing season, the IRS will make Direct File a permanent option for filing federal tax returns. Giving taxpayers additional options strengthens the tax filing system. And adding Direct File to the menu of filing options fits squarely into our effort to make taxes as easy as possible for Americans, including saving time and money.”
How it works
According to the IRS, Direct File allows taxpayers to:
Add your tax information with step-by-step guidance
Get live online support from IRS staff
Use your smartphone, laptop, tablet or desktop computer
Direct deposit your refund or make a tax payment online
The 12 states in which taxpayers were eligible to take part in the pilot are Arizona, California, Florida, Massachusetts, Nevada, New Hampshire, New York, South Dakota, Tennessee, Texas, Washington and Wyoming.
For the pilot, taxpayer eligibility to participate in the program was limited to taxpayers with certain types of income, credits and deductions – in other words, taxpayers with relatively simple returns. The IRS said it hopes to expand eligibility in the future.