Finance Forward Blog

The Internal Revenue Service has announced that its Direct File online tax filing system will become a permanent option for taxpayers starting with the 2025 tax filing season. This follows a successful pilot program in the 2024 filing season where over 140,000 taxpayers in 12 states used Direct File.

Direct File allows taxpayers to prepare and e-file their federal tax returns directly through the IRS website for free. It provides an additional no-cost electronic filing choice beyond options like using tax software, hiring a preparer, or using free file fillable forms.

Based on positive user feedback and data analysis from the pilot, the IRS decided to make Direct File a permanent part of its services. Over 90% of pilot users rated their experience as excellent or above average, citing the ease of use, trustworthiness, and free cost as major benefits.

For the 2025 tax season, the IRS plans to open Direct File eligibility to taxpayers in all 50 states, not just the 12 pilot states. It will also work to expand the types of tax situations supported over time, with a goal of covering most common situations faced by individual taxpayers.

While Direct File adds a new free option, it does not replace existing free filing methods or paid tax prep products and services. Professional tax preparers and commercial tax software providers remain critical partners to the IRS and tax system as a whole.

The decision shows the IRS's commitment to modernizing its technology and services to improve the tax filing experience. Direct File could save taxpayers time and money, while building public trust through a straightforward, transparent process directly with the IRS.

We will continue monitoring developments around Direct File's 2025 expansion. Taxpayers interested in this new option should check the IRS's website next tax season for eligibility details and updates.

Need Some Backup With Your Personal or Business Taxes?

If you need help with your personal or business taxes, don’t hesitate to reach out! You can book a free consultation call with us at your convenience.