IRS Launches Direct File Pilot Program in 12 States

The new free online tax filing tool aims to simplify tax returns for millions, offering an alternative to commercial software.

IRS Direct File is now available in 12 states, providing a free option for taxpayers with simple tax situations.
The program supports W-2 income, certain tax credits, and standard deductions, but has limitations on more complex tax situations.
An estimated 19 million taxpayers may be eligible to use Direct File this tax season, with the program expected to expand in the future.
The Direct File initiative is part of efforts to enhance IRS services and reduce costs for taxpayers, following the Inflation Reduction Act of 2022.
Tax preparation companies express concerns over the IRS's entry into the free tax filing market, highlighting existing free options.