As tax season starts in earnest in the US, the Internal Revenue Service (IRS) has relaunched its long-awaited IRS-run free tax filing website as a pilot project for taxpayers in 12 states. The Biden administration’s Direct File product aims to offer free federal tax filing to citizens, replacing commercial tax software such as Intuit’s TurboTax.

Direct File has officially gone live after nearly a month of rigorous testing. Taxpayers in participating states can now file their taxes through the site, just in time for the frenetic homestretch of tax season, when most households have yet to file.

Taxpayers residing in the 12 states whose tax situations are considered sufficiently simple can sign up for an account on the Direct File website and file their tax returns starting Monday, according to the IRS announcement. For taxpayers in the current tax year, the self-employed, the rich – anyone making more than $200,000 a year – are off-limits for Direct File.

The Direct File website represents a trial of government-managed tax filing. Following the authorization of a study by Congress in 2022 and swift action by the IRS to establish the platform, Direct File initially underwent testing phases exclusively among government employees who volunteered to participate. Subsequently, the site was opened for brief testing windows to interested taxpayers before its full-scale launch.

Moving forward, Direct File will remain continuously accessible to taxpayers. However, the IRS has indicated that the site may temporarily close during its initial week of operation in the event of excessive user traffic.

The Direct File site caters to taxpayers in Arizona, California, Florida, Massachusetts, Nevada, New Hampshire, New York, South Dakota, Tennessee, Texas, Washington, and Wyoming.

As the IRS’s Direct File platform debuts, it represents a significant milestone in the ongoing efforts to enhance access to free tax filing options for taxpayers nationwide. With the promise of simplicity and affordability, Direct File seeks to streamline the tax filing process and provide much-needed relief to taxpayers during the busy tax season.

Overall, the launch of Direct File shows us that innovation and modernization could be a valuable alternative to traditional offline paper forms for those filing taxes – if the IRS will only embrace the tech and take another look at how it administers the most outstanding system of taxation that the world has ever known. If a taxpayer experiences friction while using Direct File, it will be because of growing pains experienced as it wages the fight for additional resources, enabling it to become a tool that every taxpayer can use every year as a free, easy, and trustworthy way of filing their taxes.

Source: Julie Zauzmer Weil, The Washington Post March 4, 2024