The U.S. Department of the Treasury and the Internal Revenue Service (IRS) announced today that Direct File will become a permanent, free tax filing option. All 50 states and the District of Columbia have been invited to join this initiative for the 2025 filing season. This decision follows a successful pilot program where 140,000 taxpayers claimed over $90 million in refunds and saved an estimated $5.6 million in filing costs.
Direct File was established using resources from President Biden’s Inflation Reduction Act, aiming to invest in the IRS and deliver efficient service to American taxpayers. The Treasury Department plans to expand Direct File's reach and scope to benefit working- and middle-class taxpayers nationwide.
“President Biden is committed to saving Americans time and money and ensuring families receive the tax benefits they’re owed. Providing a free tool to all Americans who want the option to file directly with the IRS is key to achieving those goals,” said U.S. Secretary of the Treasury Janet L. Yellen. “After a successful pilot, we are making Direct File permanent and inviting all 50 states to offer this free filing option to their residents. The Treasury Department and IRS look forward to working with states to expand Direct File for Americans across the country.”
Direct File aligns with the Biden-Harris Administration’s goal of delivering modern customer service using Inflation Reduction Act resources. It also supports an objective of the IRS’s Strategic Operation Plan (SOP) by ensuring taxpayers receive eligible tax credits such as the Child Tax Credit and Earned Income Tax Credit. The IRS aims to continually improve Direct File, maintaining its free, secure, and user-friendly nature.
During Filing Season 2024, Direct File was available in 12 states for taxpayers with simple tax situations. The pilot exceeded expectations, with more than 140,000 Americans successfully filing within five weeks after extensive product testing. These users reported high satisfaction levels; in a GSA Touchpoints survey of over 11,000 participants, 90 percent rated their experience as “Excellent” or “Above Average.” Many respondents had previously paid for tax preparation or had not filed taxes at all last year.
In engagements with Direct File users, feedback indicated that they found it straightforward and appreciated features explaining various tax situations, credits, and deductions. Users valued that Direct File remained free without hidden fees or upselling attempts during the process.
Based on user feedback, survey results, and additional data analysis, IRS Commissioner Danny Werfel recommended making Direct File permanent due to overwhelming user satisfaction, improved ease of tax filing, and reduced taxpayer costs—a recommendation accepted by Secretary Yellen.
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