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Ask The Expert: Tips for Filing Taxes
The tax filing deadline is just a couple days away. LiveNOW from FOX's Andrew Craft spoke with Marketwatch's Andrew Keshner for tips if you're filing last minute.
LOS ANGELES - The IRS has announced the expansion of its Direct File program, allowing over 30 million taxpayers to file their taxes directly with the agency for free in the 2025 filing season. Initially launched as a pilot in 12 states during the 2024 tax season, the program will now be available in 24 states.
According to IRS Commissioner Daniel Werfel, the success of the pilot prompted the agency to make the Direct File program permanent, with plans to further expand in the future.
Werfel said, "We’re announcing significant expansions of Direct File that will make the service available to millions more taxpayers in 2025."
What is the IRS Direct File program?
The IRS Direct File program allows taxpayers to file their taxes directly with the federal government for free, bypassing commercial tax preparation software. First rolled out as a pilot in 2024, the program was a success, enabling taxpayers in 12 states to claim over $90 million in refunds.
Due to the pilot’s success, the IRS announced it will make the Direct File program permanent and expand it in the 2025 tax season to over 30 million people in 24 states.
FILE - In this photo illustration, a 1040 U.S. Individual Income Tax Return document is seen on a desk. (Photo illustration by Michael Bocchieri/Getty Images)
Which states will offer IRS Direct File in 2025?
The IRS Direct File program was initially launched in 2024 in 12 states, allowing certain taxpayers to file their taxes directly with the federal government. These states include:
- California
- New York
- Arizona
- Florida
- New Hampshire
- Nevada
- South Dakota
- Tennessee
- Texas
- Washington
- Wyoming
- Massachusetts
For the 2025 tax season, the IRS will expand the program to 12 more states, increasing access for millions of taxpayers. The newly added states are:
- Alaska
- Connecticut
- Idaho
- Kansas
- Maine
- Maryland
- New Jersey
- New Mexico
- North Carolina
- Oregon
- Pennsylvania
- Wisconsin
Why is the IRS expanding Direct File?
The expansion is part of the IRS’s efforts to make tax filing easier and more affordable. Many other countries, such as Germany and Japan, have long offered free direct tax filing for their citizens. IRS Commissioner Daniel Werfel emphasized that this program allows U.S. taxpayers to benefit from similar services.
Funded by the Inflation Reduction Act signed by President Biden in 2022, the IRS received $15 million to explore the creation of a Direct File system. The goal is to cut costs for taxpayers and offer a straightforward alternative to paid tax preparation software.
Are there concerns about data protection?
Despite the program’s benefits, there are concerns about data protection. A report from the IRS inspector general highlighted that the IRS has not maintained adequate safeguards over data protection within the IRS Free File Alliance. While the Direct File program is separate, it’s important for the IRS to address these concerns as they expand their tax services.