IRS Launches Tax Filing Site; Here’s How To File Your Taxes for Free!

The IRS is testing Direct File, which might soon be accessible for millions of US taxpayers. The IRS must assess the cost and viability of the pilot program in 12 states under the Inflation Reduction Act of 2022.

After presenting its results to Congress in May 2023, the government developed the free software. On January 29, preselected taxpayers could use Direct File, and on February 21, additional participants may join the trial program. The new IRS free tax filing software works, so submit taxes early for 2024, as per to CNET.

IRS Pilots Direct File Program for Taxpayers

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The US Internal Revenue Service (IRS) building is seen on the first work day for furloughed federal workers following a 35-day partial government shutdown in Washington, DC, January 28, 2019. - The five-week government shutdown subtracted $11 billion from the US economy, about twice the amount President Donald Trump sought to fund a border wall, an independent congressional body said Monday.

The IRS is piloting its Direct File program, allowing certain taxpayers to prepare and file their individual federal returns directly to the IRS with real-time support from agency representatives. The program is being rolled out in phases, with the IRS expecting more wide availability by mid-March. Business owners will have to wait for their chance to try out the software.

This no-fee government option comes at just the right time as tax season has become a perennial drain on people's time and money. On average, individuals spend an estimated 13 hours and $240 filing a single tax return, while small businesses spend roughly 82 hours and $2,900 on tax compliance.

The Biden Administration first announced the development of this tool last year, which has drawn the ire of thirteen Republican state attorneys general who sent a letter to Treasury Secretary Janet Yellen last month calling the program unnecessary and unconstitutional.

Currently, taxpayers are eligible for Direct File if they live in one of the twelve participating states and are only reporting certain types of income, credits, and deductions. The IRS aims to roll out the software in both English and Spanish in small batches at first and elicit feedback from users before potentially expanding access.

Filers can claim the Earned Income Tax Credit, the Child Tax Credit, and credits for other dependents, while deductions include the standard deduction, student loan interest, and educator expenses, according to Inc.

Steps for Using Direct File

Here are the steps to use Direct File:

1. Visit the Direct File website and verify your eligibility. During this tax season, Direct File will only be available in 12 states and may not address all tax scenarios. For instance, the tool cannot be utilized by self-employed individuals, those with wages exceeding $200,000, or those interested in itemizing deductions.

There are 12 states in total: Arizona, California, Florida, Massachusetts, Nevada, New Hampshire, New York, South Dakota, Tennessee, Texas, Washington, and Wyoming.

2. Register with ID.me. Before proceeding with your tax return, make sure to complete the identity verification process using this tool.

3. Visit Direct File in the coming days. The IRS stated Wednesday that the website will be available to new users for "short, unannounced windows of time" to test it. IRS and US Digital Service staff constructed the site over several months, prioritizing prudence.

4. Check in on a site-open day. Whether there's an open window or not, the IRS says you may return to finish your tax return.

5. Wait a few weeks till the site is always available if you can't access it now. There are several alternative free tax filing options.