There may be a new, free way to file your taxes in 2024. Here’s what the IRS is planning
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The IRS is launching a pilot of a free, direct tax filing option in 2024.
The IRS submitted a report to Congress this week, evaluating the possibility of an optional direct file system.
They found 72% of a sample of taxpayers would be interested in using this. And 68% of taxpayers who self-prepare would consider switching. One person spends about 8 hours and $140 preparing their taxes each year.
The $14 billion tax preparation industry is opposed. A spokesman for Intuit (the company behind TurboTax) told NPR a direct system is “wholly redundant” and “nothing more than a solution in search of a problem.”
TurboTax is actively paying out settlement checks to low-income Americans “tricked” into “paying for free tax services,” as part of a multi-state agreement, according to the Office of the New York Attorney General.
The IRS says a successful program would need a sustained budget investment and careful management. It could cost between $64 million and $249 million a year.
The report was mandated by the Inflation Reduction Act, which provided $80 billion over 10 years to the IRS in areas like enforcement and modernization. And while there have been some improvements, McClatchy reported earlier this year, service problems have plagued the IRS for years.
This story was originally published May 18, 2023 at 5:00 AM with the headline "There may be a new, free way to file your taxes in 2024. Here’s what the IRS is planning."
