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Home » News » IRS Direct File program faces uncertainty in 2025

IRS Direct File program faces uncertainty in 2025

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  • Digital Team 
Flat-style illustration of a yellow 'Uncertainty' road sign and a blue 'Direct File' sign along a winding road, symbolizing the uncertain future of the IRS Direct File program.

ThThe IRS Direct File program, which offers taxpayers a free, government-operated way to file federal tax returns online, faces an uncertain future in 2025. Due to budget debates and political opposition, questions have arisen about whether the program will expand, be limited, or end entirely.

What is the IRS Direct File program?

Launched as a pilot project, Direct File allowed eligible taxpayers in select states to file simple federal tax returns directly with the IRS, bypassing commercial tax preparation companies. It was designed to offer a free, streamlined filing experience without hidden fees or upsells.

The program received strong support from taxpayer advocacy groups. However, it also faced fierce opposition from commercial tax prep companies, who argued it created unfair government competition.

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Why is Direct File’s future uncertain?

Several factors threaten the continuation or expansion of Direct File. These include:

  • Congressional funding battles: Funding for Direct File was temporary and requires renewal.
  • Political opposition: Some lawmakers oppose the government offering tax filing services.
  • Industry lobbying: Tax prep companies have lobbied heavily against expanding Direct File.

Without new funding and legislative support, the program may shut down or remain limited to a small number of states.

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How this could impact taxpayers

If Direct File ends or fails to expand, millions of taxpayers could lose access to a free, government-backed filing option. Consequently, they would have to continue using commercial tax software or paid preparers, many of whom charge high fees or upsell services.

Taxpayers who benefited from Direct File appreciated its simplicity, transparency, and lack of hidden charges.

Without it, filing costs for simple returns could increase again, especially for low- and moderate-income filers.

What taxpayers should do now

To prepare for possible changes, taxpayers should:

  • Watch for IRS updates about the availability of Direct File for 2026.
  • Explore alternative free filing options, such as IRS Free File, which partners with private companies.
  • Advocate for expanded free filing options by contacting their representatives.

For the latest information, visit irs.gov.

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