The Trump administration intends to terminate the IRS’s free Direct File tax program, according to a report from the Associated Press citing two sources familiar with the decision.
The Direct File system, launched as a pilot in 2024 and made permanent last May, enables Americans to file taxes online directly with the IRS at no cost. However, IRS staff assigned to the program were reportedly told in mid-March to halt work on the 2026 filing season.
The system was created under the 2022 Inflation Reduction Act, with tens of millions invested in its development by the Biden administration. While the program gained support for eliminating tax preparation costs for filers, it faced opposition from Republicans and private tax preparation firms.
Critics of Direct File argued the system duplicates existing free options and threatens private businesses, despite data showing the average filer still spends about $140 per year.
Senior presidential adviser Elon Musk also noted earlier this year he had dismantled 18F, a digital services agency involved in building such government programs.
Sources
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