post-thumb

IRS to offer nationwide free tax filing program in 2025

IRS Commissioner Danny Werfel testified before the House Appropriations Committee in Washington, D.C., on May 7, 2024. During his testimony, he announced that the IRS will expand its Direct File program nationwide starting in 2025. Direct File is a free tax filing program that was piloted in 2024 in several states, including Arizona, California, and New York.

The expansion of Direct File will allow all 50 states to offer this free filing option to their residents. U.S. Secretary of the Treasury Janet Yellen expressed her support for the program, stating that the Treasury Department and IRS look forward to working with states to expand Direct File to Americans across the country. IRS Commissioner Danny Werfel also mentioned that the agency is exploring ways to make additional taxpayers eligible to use the system in the future.

The Direct File pilot in 2024 focused on simple filings, such as taxpayers with Form W-2 wages, Social Security retirement income, and unemployment earnings. However, it excluded taxpayers with contract income reported via Form 1099-NEC, gig economy workers, and self-employed filers. Filers also had to claim the standard deduction for their filing status.

Werfel emphasized that Direct File is meant to be an additional option for taxpayers and is not meant to replace other important options provided by commercial tax software companies. The news about the expansion of Direct File comes shortly after the IRS announced plans to extend its Free File program, which allows many Americans to file federal taxes for free through a partnership with private tax software companies.

Overall, the expansion of Direct File is seen as a positive step towards providing more options for taxpayers to file their taxes for free and simplifying the tax filing process for working families. It remains to be seen how the program will be implemented nationwide in 2025 and which states will choose to participate.

Share:

More from Press Rundown