It seems that with Trump’s arrival at the White House, all those initiatives implemented during Biden’s administration, especially those that favored the population, are being eliminated. This time, it has been the turn of the pilot initiative launched in 2024 as part of the Inflation Reduction Act to modernize the IRS, Direct File. Through it, Americans could file their taxes completely free of charge with the Internal Revenue Service (IRS). According to Scott Bessent, Secretary of the Treasury, it has not been widely used by citizens. However, the truth is that nearly 300,000 Americans filed their tax returns through Direct File in 2025, doubling the number who did so in 2024, demonstrating the positive reception the pilot test had.
However, tax preparation companies like Intuit and H&R Block expressed their opposition to this measure, calling it “unauthorized and wasteful.” Direct File will no longer be an option for the final 2026 season, but alternatives such as IRS Free File, Volunteer Income Tax Assistance (VITA), Tax Counseling for the Elderly (TCE), or Free File Fillable Forms will be available. Nevertheless, despite the alternatives, data collected by the Urban Institute in 2024 showed that three-quarters of respondents were interested in using this program, which demonstrates the interest and positive reception it had among citizens.
Suspension of the Direct File
Like almost all social measures proposed during Biden’s term, it is now time to eliminate one more: the Direct File program. It is a free, government-administered tax filing system through which eligible users in 25 states could file their tax returns completely free of charge and directly with the Internal Revenue Service (IRS). It was launched in 2024, becoming one of the most highly rated tools by Americans during the 2025 tax seasons, but it will cease to exist for the 2026 tax season.
Scott Bessent, the Treasury Secretary who is also the acting IRS Commissioner, stated, “It has not been used much,” Bessent said. “We believe there are better alternatives and that the private sector can do a better job.” So after two years of a pilot program and having received an enthusiastic response, Direct File will no longer be available. For two years, taxpayers were able to use simple, free software without relying on professional preparers and their high fees.
Why end the Direct File?
Despite Bessent’s statements, the truth is that the data reflected a different reality. Nearly 300,000 Americans filed their applications through Direct File during the 2025 tax season, more than double the number from its debut year. This reception is also reflected in satisfaction survey data conducted after its use, in which 94% of users considered their experience to be “excellent” or “above average.” Special reference was made to the simplicity of the software, as well as the lack of upselling.
But, as with everything, there were also voices that labeled it as “unauthorized and wasteful,” as the Republicans did, and the main tax preparation companies, Intuit and H&R Block, also opposed it. The opposition to this project argued that the $41 million spent on its implementation should have been invested in private partnerships. According to Adam Ruben of the Economic Security Project, ‘Trump’s billionaire friends receive favors while honest, hardworking Americans will pay more to file their taxes”.
Alternatives to Direct File
The IRS has wanted to highlight other types of alternatives to Direct File for the 2026 tax season:
- IRS Free File: Connects taxpayers who earn $84,000 or less with partner software that guides them through their tax return. It is available to 70% of U.S. taxpayers, although less than 2% used it last year.
- Volunteer Income Tax Assistance (VITA): Provides in-person help for individuals who earn $67,000 or less, as well as for those with disabilities or limited English proficiency.
- Volunteers are IRS-certified and can file returns on behalf of participants.
- Tax Counseling for the Elderly (TCE): Offers free support to individuals over 60 years old, particularly regarding retirement income and pension-related tax issues.
- Free fillable file forms: electronic versions of the IRS standard forms are available to everyone, although they require more manual input and do not include guided assistance.
However, it seems that all is not lost. A spokesperson for the agency said that a new task force will study “long-term alternatives” for Direct File, focusing on how to make free filing more accessible while reducing costs.
