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direct file
After Lobbying Blitz, Trump IRS Formally Kills Direct File Program That Would've Saved Americans Billions
"It was never about efficiency, it's about Trump and his billionaire allies taking money from our pockets to make the tax system worse and line the pockets of big business elites in this predatory industry," said a spokesperson at Americans for Tax Fairness.
Aug 01, 2025
In a move backed by private tax-filing corporations, the administration of U.S. President Donald Trump officially announced the shut down of the government's free Direct File service this week.
For two years under the administration of former President Joe Biden, the IRS allowed taxpayers in some states to file their taxes online using public software under a pilot program.
A report published in March by the Economic Security Project found that:
At maturity in five years, Direct File would save the average user $160 in filing fees and hours of their time each year, which saves Americans a total of $11 billion annually between filing fees and time costs. By breaking down barriers to filing, Direct File would also deliver up to $12 billion each year in additional tax credits to low-income families currently missing out.
In January, the direct file system was rolled out to 30 million Americans across 25 states, to rave reviews. According to a memo circulated within the Internal Revenue Service (IRS), the program was "beloved by its users," with a 94% satisfaction rate among those who used it.
But according to IRS Chairman Billy Long, who spoke at a tax summit Monday, it will not be made available again in 2026.
"You've heard of direct file, that's gone," Long gloated. "Big beautiful Billy wiped that out."
"I don't care about Direct File. I care about direct audit," he added, referring to his efforts to make it easier for businesses and individuals under tax audits to get updates on their status.
The budget legislation that Trump signed into law last month did not formally end Direct File, as Long suggested. However, it did allocate $15 million to the Treasury Department for a task force to study public-private partnership alternatives to replace Direct File. "Big beautiful Billy" likely referred to Long himself, whose IRS formally ended the program.
Long's announcement was the culmination of a months-long scheme by private tax-filing corporations like Intuit and H&R Block, and Republicans in government to kill Direct File.
As early as December, following Trump's reelection victory, GOP congresspeople began calling for the program's demise. Twenty-nine of them, who'd accepted a combined $1.8 million in campaign donations from the tax prep industry over their careers, signed onto a letter written by Reps. Adrian Smith (R-Neb.) and Chuck Edwards (R-N.C.) calling on Trump to issue a "day-one executive order" killing the program.
Long, himself a former congressman from Missouri, raised eyebrows in January 2025, shortly after he was named as Trump's nominee to lead the IRS. According to The Lever, he received a curious $137,000 worth of donations that he then used to pay himself back for a $130,000 loan he'd made to his failed 2022 campaign for the Senate. Around a third of the money came from tax consultancy firms.
In March, following mass layoffs at the IRS by Elon Musk's Department of Government Efficiency (DOGE), staff working on the Direct File system were told to halt their work. Prior to that, Musk wrote on his social media app X that he had "deleted" 18F, the government agency working on the project.
Right after tax day in April, The Associated Press first reported that the administration was planning to end the program.
While consumer advocacy groups called the change a "big loss" for the public, the American Coalition for Taxpayer Rights, an astroturf group backed by tax-filing companies, thanked Smith, Edwards, and other GOP congresspeople "for their leadership" calling for the termination of the program.
The program was effectively dead for months, but Long's gleeful coroner's report this week made it official.
"Last year, Direct File saved taxpayers $5.6 million in tax preparation costs by allowing people to file their taxes for FREE," wrote Rep. Alexandria Ocasio-Cortez (D-N.Y.) Friday on X. "That's why tax preparation companies like... Intuit lobbied to get rid of it. Trump just gave them their wish."
Despite claims by GOP congresspeople that the program was "wasteful," it actually saved taxpayers much more money than it cost. According to the Economic Security Project's study, "For every dollar invested in the program, Direct File delivers $106 in benefits to American taxpayers, between savings on tax preparation fees and access to untapped tax credits."
"This move exposes what's really happening in Trump's administration," said David Kass, the executive director of Americans for Tax Fairness. "It was never about efficiency, it's about Trump and his billionaire allies taking money from our pockets to make the tax system worse and line the pockets of big business elites in this predatory industry."
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'Big Loss for the Public': Trump to End Free IRS Tax Filing Program
"Donald Trump and Elon Musk are going after Direct File because it stops giant tax prep companies from ripping taxpayers off for services that should be free."
Apr 16, 2025
On the heels of Tax Day in the United States, The Associated Press reported Wednesday that the Trump administration plans to end Direct File, a free electronic program for filing tax returns to the Internal Revenue Service, citing two unnamed sources familiar with the decision.
The news drew swift outrage, including from U.S. Sen. Elizabeth Warren (D-Mass.), who took aim at President Donald Trump and his adviser Elon Musk on the billionaire's social media platform X.
"Donald Trump and Elon Musk are going after Direct File because it stops giant tax prep companies from ripping taxpayers off for services that should be free," said Warren. "Americans want a free and easy way to file their taxes—Trump and Musk want to take that away."
According to the AP:
The program had been in limbo since the start of the Trump administration as Elon Musk and the Department of Government Efficiency have slashed their way through the federal government. Musk posted in February on his social media site, X, that he had "deleted" 18F, a government agency that worked on technology projects such as Direct File.
There was some hope that Musk, with his DOGE team of computer programmers, could take over Direct File and improve it. But the two people familiar with the decision to end Direct File said its future became clear when the IRS staff assigned to the program were told in mid-March to stop working on its development for the 2026 tax filing season.
Concerns about the future of the program—rolled out under the Biden administration—predated Musk's post. Dozens of congressional Republicans urged Trump to scrap the program in December, and the following month, the consumer advocacy group Public Citizen revealed that throughout those 29 lawmakers' careers, they had taken more than $1.8 million in campaign contributions from "Big Tax Prep and their proxies."
Public Citizen was among the organizations that responded to the reporting on Wednesday by blasting the Trump administration for "taking money out of the pockets of working people and giving it away to their Big Business and tech bro buddies."
Yale Law School professor Natasha Sarin—who was previously an official at the U.S. Treasury Department—wrote on social media that "this is terrible, terrible, terrible news for the American people and the tax system. The only winners are high-cost tax preparers."
"President Trump has said tax filing should be so simple that you could file on a postcard!" she noted. "The IRS had built something even better... It's devastating to watch so much good work undone."
While many Republicans in the U.S. House of Representatives pushed to kill Direct File, multiple Democrats from the chamber joined the chorus of condemnation in response to Wednesday's reporting.
"IRS Direct File gave people a simple and FREE way to file their taxes. Trump wants to get rid of it and allow tax preparation corporations to continue to rip taxpayers off with predatory fees," said Rep. Pramila Jayapal (D-Wash.). "So much for cutting costs for the American people."
Congressman Jerry Nadler (D-N.Y.) similarly said that "Trump's plan to kill Direct File is a gift to billion-dollar tax prep companies at the expense of American families. Once again, he's siding with profits over people."
Direct File, a prime example of making government more efficient, gave Americans an easy and free option to file their taxes. But Donald Trump cares more about his wealthy friends than working Americans so he wants to kill the program and make filing taxes harder. apnews.com/article/irs-...
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— Congressman Don Beyer (@beyer.house.gov) April 16, 2025 at 4:39 PM
Rohit Chopra, whose previous roles in government include directing the Consumer Financial Protection Bureau under former President Joe Biden, called out one company in particular, declaring the development "a big win for Intuit's profits on TurboTax, but a big loss for the public."
While Trump and Musk have framed their government-gutting work as an effort to make the federal bureaucracy more "efficient," their plans to destroy the program seem to accomplish the opposite. Before the news broke, Groundwork Collaborative senior fellow Kitty Richards said in a Tuesday statement that "Direct File is a crystal clear example of government efficiency at work."
"Taxpayers shouldn't have to pay exorbitant fees to predatory for-profit companies just to file their taxes," Richard asserteds. "As cost-of-living remains top of mind for so many Americans, the government should invest in and expand tools like Direct File that put money back into the pockets of working families."
"Unfortunately, the president is waging a war against the IRS—and hamstringing vital taxpayer services like Direct File in the process—so his wealthy donors can cheat on their taxes," she added. "The only people who benefit from a weakened IRS are billionaires like Donald Trump and Elon Musk."
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Why You Should Take Advantage of IRS Direct File This Tax Season
Widespread participation will help solidify the future of this important service amid the chaos in the federal government.
Apr 11, 2025
With Tax Day rapidly approaching, taxpayers who haven’t yet filed could have a great option available to them this year. Half the states in the nation now have access to a zero-cost tool created by the Internal Revenue Service called Direct File that allows people to file taxes online directly to the government using a question-based software.
Direct File is a much better option than paying for expensive corporate-owned software or hiring a private tax-prep company. The typical taxpayer ends up spending an average of eight hours each year completing their tax returns in addition to shelling out $160 a year to pay for a service that should be—and is now—free of charge.
Last year, Direct File software was made available through a pilot program to those with relatively simple tax situations living in Arizona, California, Florida, Massachusetts, Nevada, New Hampshire, New York, Texas, Tennessee, South Dakota, Washington, and Wyoming.
The user testimonials speak for themselves. “It was the fastest I’ve ever done my taxes,” said one user. “I wish everyone could do their taxes that easily,” said another.
This year, in addition to the 12 states from last year’s pilot program, all of which are participating again, Direct File has been expanded to include Alaska, Connecticut, Idaho, Illinois, Kansas, Maine, Maryland, New Jersey, New Mexico, North Carolina, Oregon, Pennsylvania, and Wisconsin.
Approximately 30 million people across the 25 participating states are eligible to use Direct File. And there are many reasons to welcome this new e-file tool created by the IRS.
Direct File was designed to make it as easy as possible for people to file taxes. In addition to being free of charge, the tool is mobile-friendly, available in both English and Spanish, and has live chat assistance from the IRS. What’s more, the tool now pre-populates some information that the IRS already has in its records to make the process even quicker and error-free, which is a huge improvement over its original version.
What’s more, Direct File is intended to help people claim credits like the Earned Income Tax Credit (EITC), which around one in five eligible filers don’t currently claim.
Research shows that when Direct File is fully scaled up, Americans could collectively save up to $11 billion in filing costs alone, while low and moderate-income families could recoup $12 billion in tax credits like the EITC and Child Tax Credit that they’re currently missing out on. That money could come in handy for families struggling to make ends meet in these times of rising costs.
Predictably, Direct File is overwhelmingly popular with the American public. More than 90% of people who used Direct File last year said that the tool is “Excellent” or “Above average.”
The user testimonials speak for themselves. “It was the fastest I’ve ever done my taxes,” said one user. “I wish everyone could do their taxes that easily,” said another.
It’s not just popular with those who’ve used it. Direct File has been cheered by more than 140 members of Congress; 16 attorneys general; 134 leading experts on the U.S. tax system; and more than 250 national, state, and local organizations representing all 50 states, the District of Columbia, and Puerto Rico.
During his confirmation hearing, Treasury Secretary Scott Bessent said he would commit to keeping Direct File in 2025. However, amid the current chaos happening in the federal government, its future in 2026 and beyond is less certain. Big tax prep corporations have been handing out cash to opponents of Direct File in Congress in the hopes of gutting the program.
For Direct File to remain an option in future years, it’s critical that taxpayers take advantage of the tool right now. Widespread participation will help solidify the future of this important service.
So if you haven’t filed your taxes yet, go to directfile.irs.gov to see if you’re eligible.
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