By Fatima Hussein
WASHINGTON (AP) — The Trump administration plans to eliminate the IRS’ direct file program, according to two people familiar with the decision.
The program developed during Joe Biden’s presidency was recognized by users as making tax filing easier, faster and more economical. However, Republican lawmakers and commercial tax prep companies complained that it was a waste of taxpayers’ money as a free application program already exists.
The program has been on the frontier since the start of the Trump administration, when Elon Musk and the government’s efficiency paved their way through the federal government. The mask was posted on social media site X in February. He “deleted” 18F, a government agency that worked on technology projects such as directly file.
With his Doge team of computer programmers, there was hope that Musk could take over files directly and improve them. However, the two, familiar with the decision to terminate the file directly, said its future became clear when IRS staff assigned to the program were instructed in mid-March to halt development efforts for the 2026 tax return season.
The pair were not permitted to discuss the plan publicly and spoke to the Associated Press on condition of anonymity.
“The revision was from the start,” said Adam Reuben, vice president of the Liberal Economic Security Project.
“It’s anger to see everyday taxpayers not playing a role in this decision,” he said. “Slashing costs and saving money for the family was a promise of an empty campaign.”
But David Williams, president of the Taxpayer Protection Alliance, has said it is a nonpartisan organization that popularizes research and analysis of government’s economic impact, saying the direct file is “problems” from day one, citing the cost of the programme, pointing out that many people who started the process are not over. According to IRS 423,450 taxpayers, 140,803 people filed accepted returns, which were recorded directly in file in 2024.
“From hidden costs to taxpayer confusion, the program is full of problems,” Williams said.
After the IRS considered how to create a “direct file” system in 2024, the file was deployed directly in 2024 as a pilot program. Democrats spent tens of thousands of dollars developing the program as part of the money they received from the Inflation Reduction Act, which Biden signed into law in 2022.
Last May, the agency announced that the program would be permanent.
However, the IRS faced intense blowback to direct files from private tax preparation companies, with billions of people charging people to use the software and spending lobbying millions of people. The average American usually prepares a return of around $140 each year.
“Direct files are seeking problems, a solution for draining important IRS resources, taxpayer waste, and taxpayer waste,” said Derrick Plummer, a spokesman for commercial tax preparation company Intuit.
The IRS has accepted 140,803 returns filed by taxpayers using direct files in 12 states where the last tax season is available. This year it was expanded to include half of the country. It is unclear how many taxpayers used the file directly this year.
Amanda Renteria, who worked with the IRS to create a direct file state tax return integration program, said the decision that “the government should accurately demonstrate its ability to demonstrate its ability to effectively provide basic services” was a “betrayal of public trust.”
Senator Elizabeth Warren, the proponent of building files directly, said in an emailed statement that Trump and Musk are “pursuing files directly to stop the huge tax preparation companies from tearing taxpayers for the services they should be free.”
Original issue: April 16, 2025, 2:38pm EDT
