--- title: The IRS’s Free Direct File Program Is on the Chopping Block. What Went Wrong? description: IRS Direct File works to solve the common problem of high tax filing fees — so why is the Trump administration poised to kill it? authors: - name: Pete Grieve role: Lead News Reporter url: https://money.com/author/pete-grieve/ bio: Pete Grieve is a personal finance reporter. In his time at Money, Pete has covered everything from car buying to credit cards to the housing market. education: University of Chicago, BA Political Science at_money_since: 2022 articles: 602 covers: - Taxes - Banking - Business - Career Advice - Credit - Credit Cards - Debt - Economy and Politics - Education - Health and Wellness - Housing - Identity Theft - Insurance - Investing - Lifestyle - Loans - Mortgages - Personal Finance - Professional Services - Retirement - Shopping social: - https://twitter.com/pete_grieve - https://linkedin.com/in/pete-grieve-b5aa02138 - https://www.facebook.com/petegrieve4 editors: - name: Julia Glum role: Managing Editor url: https://money.com/author/julia-glum/ bio: A graduate of the University of Florida, Julia has more than eight years of experience in personal finance journalism. In addition to overseeing news and newsletters, she leads Money’s tax coverage, which includes extensive reporting on tax credits, policy changes and the IRS. education: University of Florida at_money_since: 2018 articles: 453 covers: - Taxes - Banking - Business - Career Advice - Credit - Credit Cards - Debt - Economy and Politics - Education - Health and Wellness - Housing - Identity Theft - Insurance - Investing - Lifestyle - Loans - Mortgages - Personal Finance - Professional Services - Retirement - Shopping - Technology also_seen_in: - Newsweek - International Business Times - CBS News - Good Morning America - WUSA9 - Pix 11 - The New York Times - Mashable - The Washington Post - CNBC - Politico social: - https://x.com/superjulia - https://www.linkedin.com/in/julia-glum published: '2025-04-29T18:57:13.000Z' modified: '2025-04-29T20:20:07.000Z' section: Taxes tags: - News word_count: 1003 canonical: https://money.com/is-irs-direct-file-ending/ type: NewsArticle source: structured-blocks --- > **Disclosure:** We research all brands listed and may earn a fee from our partners. Research and financial considerations may influence how brands are displayed. Not all brands are included. [Learn more](https://money.com/page/disclaimer/). ![Close-up of a person using a computer, with the IRS website on it.](https://img.money.com/2025/04/News-IRS-Direct-File-Eliminated.jpg) With its [Direct File](https://money.com/irs-direct-file-eligibility-2025/) program, the IRS tried to give U.S. taxpayers a free solution to a longstanding complaint: that tax prep is too expensive. Created by the Inflation Reduction Act, Direct File rolled out as a pilot in the 2024 filing season and was later made permanent by the Biden administration. This past tax season, it was available to certain taxpayers in 25 states. (Unlike the agency's [Free File](https://money.com/irs-free-file-2025-eligibility/) initiative, which involves partnerships with tax preparation companies, Direct File is run in-house by the IRS.) Now, its future may be in jeopardy. ## The right Tax Relief firm makes all the difference, especially if you owe over $10,000 in taxes. ### Get the tailored experience that you expect from the tax litigation professionals in your area. Click on your state to get started! [Get Started](https://money.com/pr/kc0833a52be9?ap_referrer=%2Fis-irs-direct-file-ending%2F) FedScoop recently [reported](https://fedscoop.com/trump-administration-set-to-end-irs-direct-file-program/) that IRS Direct File would be eliminated by the Trump administration. Sources told the [Associated Press](https://apnews.com/article/irs-direct-file-tax-returns-free-trump-4bb0bca02fab9b3d06ae6f45ac67b7ab) the same thing — that the program was seen as government waste and would not be continued for future tax filing seasons — leading senators like Finance Committee member Elizabeth Warren, D-Mass., to [speak out](https://www.warren.senate.gov/imo/media/doc/letter_from_senator_warren_congressional_democrats_to_trump_on_direct_file.pdf) against its elimination. Amid these rumors, the Trump administration has stayed almost completely mum about Direct File beyond a February X post from Tesla CEO and presidential advisor Elon Musk that the team that built the program had been "[deleted](https://apnews.com/article/irs-direct-file-musk-18f-6a4dc35a92f9f29c310721af53f58b16)." The IRS, the Treasury and the White House did not respond to Money's requests for comment. But a Treasury spokesperson did tell [Tax Notes](https://www.taxnotes.com/featured-news/treasury-still-deciding-direct-files-fate/2025/04/22/7s14f) last week that Direct File is a "failed program at a cost of tens of millions of taxpayer dollars per year." The official clarified: "No decisions on the future of Direct File have been made as of yet." Over 140 million taxpayers file returns every year, and Direct File was meant to solve the common problem of high fees for filing services — so what went wrong? Critics say the program was off to a shaky start with low participation and limited functionality, and President Donald Trump's election victory may have marked the beginning of the end for the fledgling program. ## The shortcomings of Direct File Former IRS Commissioner Mark Everson, now alliantgroup vice chairman, tells Money he would "would be surprised if the Treasury secretary, in the end, and the IRS, elects to continue the program." Everson and other critics argue that Direct File is a waste of government resources, considering that [just 141,000 people](https://www.tigta.gov/reports/audit/inflation-reduction-act-results-direct-file-pilot) filed a return using the service in 2024 out of about 19 million who were eligible. The test alone [cost](https://tax.thomsonreuters.com/news/irs-direct-file-here-to-stay-treasury-announces/) over $30 million. "This program was always preferred by the Democrats and not by the Republicans," Everson says. "It did fine, but you're still left with this dynamic of, is this necessary? Is it too costly — which is how many feel — and very important? Is it a diversion of resources \[when\] there's so much work to be done at the IRS?" While the issue has been somewhat under the radar, the debate over Direct File is one of many examples of conservatives using their newfound power in Washington to roll back Biden-era initiatives in areas ranging from environmental regulation to student loan forgiveness. At the IRS specifically, the Trump administration has prioritized reducing government spending on staffing and audits, trying to reverse the Democrats' already controversial [investments](https://money.com/irs-funding-higher-taxes-more-audits/) in the agency. The Biden administration envisioned expanding Direct File to taxpayers with more complicated taxes as well as adding options for state tax return filing. But these limitations in Direct File's current form likely slowed the uptake. Everson — who led the IRS under former President George W. Bush from 2003 to 2007 — adds that many Americans will always be "skeptical" about using the government for their taxes. He thinks there are other ways to expand free tax filing. "It's a tiny number of people who've used the application thus far. What really should happen here is the government should lean on the Free File \[partners\], and they should improve that initiative," he says. "That's what really is the best solution." ## The case for keeping (and improving) Direct File Supporters of Direct File acknowledge it's imperfect in its current form, but they see a path for it to become a valuable program that could address "longstanding, bipartisan concerns" about the cost of third-party tax preparation services, as Tax Policy Center researchers wrote in a [recent article](https://taxpolicycenter.org/taxvox/congress-could-improve-tax-filing-making-irs-direct-file-program-permanent). The IRS has [estimated](https://money.com/irs-test-free-tax-prep-software/) that the average taxpayer spends $140 filing their return. Aravind Boddupalli, senior research associate at the center, tells Money it's unsurprising that initial usage was low. "Any time you roll out a new government service, and the government service involves your personal and financial information and shifting over from other methods of filing to a new one, the take-up is going to be slow," he says. Tax Policy Center [survey data](https://taxpolicycenter.org/briefs/most-americans-are-interested-using-irs-direct-file-prepare-and-file-their-taxes) shows a plurality of Americans are interested in eventually using Direct File. In December 2024, 73% of people who filed a tax return said "they would be somewhat or very interested in using Direct File if they had access to it." But Boddupalli says that there was limited government promotion of the program — especially compared to the onslaught of advertisements folks receive during tax season for paid tax filing services. Companies like [TurboTax](https://money.com/pr/ud31501196cb?ap_referrer=https%253A%252F%252Fmoney.com%252Fis-irs-direct-file-ending%252F) owner Intuit and [H&R Block](https://money.com/pr/u39f30622fae?ap_referrer=https%253A%252F%252Fmoney.com%252Fis-irs-direct-file-ending%252F) have also [lobbied](https://money.com/irs-direct-file-return-2025/) against Direct File as it could cut into their business. An Intuit spokesperson told [other outlets](https://www.notus.org/money/turbotax-lobby-tax-prep-direct-file) it's a "solution in search of a problem." As for the argument that Direct File takes up too much resources, Boddupalli disagrees: "Developing a free tax filing option for taxpayers shouldn't be any less of a priority than some of the other tasks that they're doing, such as modernization or going after tax evaders and tax cheats, or processing tax returns and doing customer service," he says. However, he does admit that he sees the future of the program as uncertain at best. "Interest in retaining the Direct File program seems low among the administration and among those in power," he says. ### Rated A+ by the BBB ![Get Started](https://s3.consumersadvocate.org/prd/image/image/14979/medium_d9420f2c-6d0b-4726-b903-60fb37740830.png) Our Partner [Get Started](https://money.com/go/ba835c166963?bidid=4133334067&pmeta=p129-c739-u28541&ptid=672514851&ptoken=fce27553df0dbe1347648fa92b05ad3e) ### Over 15 years of Experience ![Get Started](https://s3.consumersadvocate.org/prd/image/image/36123/medium_d8e31451-10fb-4690-a053-85981545c371.webp) Our Partner [Get Started](https://money.com/go/874396305865?bidid=4133334074&pmeta=p129-c739-u28541&ptid=672514851&ptoken=9829d88f594f72ea699d19ec1ab97e3b) ### 12+ years of tax resolution experience ![Get Started](https://s3.consumersadvocate.org/prd/image/image/19221/medium_21c467f5-9614-45a6-a827-5c1698cf1de6.png) Our Partner [Get Started](https://money.com/go/9ca31e48805e?bidid=4133334066&pmeta=p129-c739-u28541&ptid=672514851&ptoken=1b741ee62b884c5844d521a272ea037b) ### 21+ years in service ![Get Started](https://s3.consumersadvocate.org/prd/image/image/37015/medium_cb5bc133-3b62-412b-9420-e17d1c5aaa63.webp) Our Partner [Get Started](https://money.com/go/64e150b0c703?bidid=4133334070&pmeta=p129-c739-u28541&ptid=672514851&ptoken=d6acacd7281a0e8a11250bd510ca7cb7) ### 24/7 Client Portal Access ![Get Started](https://s3.consumersadvocate.org/prd/image/image/38669/medium_134094f5-0d61-4290-98dd-6ea7bc5551c2.webp) Our Partner [Get Started](https://money.com/go/a0bba1e50b61?bidid=4133334068&pmeta=p129-c739-u28541&ptid=672514851&ptoken=762d57623d95b266f1001f665678e190) ![](https://s3.consumersadvocate.org/prd/image/image/14979/medium_d9420f2c-6d0b-4726-b903-60fb37740830.png) Owe over $10,000 in taxes? Get Tax Relief with Anthem now! [Get Started](https://money.com/pr/l978cd9f37e2?ap_referrer=%2Fis-irs-direct-file-ending%2F) ```json { "@context": "https://schema.org", "@graph": [ { "@type": "BreadcrumbList", "@id": "https://money.com/is-irs-direct-file-ending/#breadcrumb", "itemListElement": [ { "@type": "ListItem", "position": 1, "name": "Home", "item": "https://money.com" }, { "@type": "ListItem", "position": 2, "name": "Taxes", "item": "https://money.com/taxes/" }, { "@type": "ListItem", "position": 3, "name": "News", "item": "https://money.com/tag/news/" }, { "@type": "ListItem", "position": 4, "name": "The IRS’s Free Direct File Program Is on the Chopping Block. 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