IRS Announces Permanent Direct File Option for 2025 Tax Season Following Successful Pilot

IRS Announces Permanent Direct File Option for 2025 Tax Season Following Successful Pilot

The Internal Revenue Service (IRS) announced on May 30, 2024, that starting in the 2025 tax season, Direct File will become a permanent option for filing federal tax returns. This decision follows a successful pilot during the 2024 season, where more than 140,000 taxpayers in 12 states utilized Direct File. The IRS is looking to expand this service to more taxpayers by broadening eligibility criteria and inviting all states to participate.

The initiative received positive feedback from various stakeholders, including hundreds of organizations and members of Congress, highlighting user satisfaction and the ease of filing. IRS Commissioner Danny Werfel emphasized that Direct File helps to simplify the tax filing process, offering a no-cost electronic option that complements existing services.

Werfel stated, “Many taxpayers across the nation want more than one no-cost option for filing electronically. Starting in the 2025 filing season, the IRS will make Direct File a permanent option for federal tax returns. Additional options strengthen the tax filing system and help make taxes easier for Americans, saving them time and money.”

Direct File will complement existing options provided by tax professionals and commercial software. The IRS remains committed to partnerships like Free File Inc. and programs such as Volunteer Income Tax Assistance program (VITA) and the Tax Counseling for the Elderly program (TCE).

During the pilot, users reported positive experiences, with 90% rating it as Excellent or Above Average. The Treasury Department estimates that Direct File users saved $5.6 million in tax preparation fees this season. The IRS plans to continue improving Direct File and expanding its availability and capabilities.

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