What You Need to Know: IRS Launches Direct File Pilot for Free Tax Filing in Tax Season 2024

By John Lopez

Mar 01, 2024 02:00 PM EST

The IRS has rolled out a new pilot program called Direct File, offering free tax filing services for Tax Season 2024. Here is everything you need to know about this development:

What You Need to Know: IRS Launches Direct File Pilot for Free Tax Filing in Tax Season 2024
(Photo : Photo by Scott Graham on Unsplash)
IRS introduces Direct File, a free tax filing program for Tax Season 2024, available in 12 states. Simplifies process, supports basic deductions, and credits.

What is a Direct File?

Direct File is a new free tax filing system introduced by the IRS. It allows eligible taxpayers to file their federal taxes directly with the IRS, free of charge. This program aims to simplify the tax filing process and make it more accessible to taxpayers nationwide.

Who Can Use Direct File?

The Direct File pilot program is available in 12 states: Arizona, California, Florida, Massachusetts, New Hampshire, New York, Nevada, South Dakota, Tennessee, Texas, Washington, and Wyoming. However, there are certain eligibility criteria that taxpayers must meet to use Direct File:

  • Taxpayers must have relatively simple tax situations, primarily those who use the standard deduction.
  • Direct File does not support itemizing deductions, but it does support deductions such as student loan interest and educator expenses deductions.
  • Only three tax credits are supported: Child Tax Credit, Earned Income Tax Credit, and Credit for Other Dependents.
  • Taxpayers with income limits within specified thresholds, depending on filing status and sources of income.

READ MORE: The IRS Proposes Child Tax Credit Expansion To Benefit 16 Million Low-Income Children

How Does Direct File Work?

Direct File operates similarly to popular tax-filing software like TurboTax or H&R Block. Taxpayers answer a series of questions, and the software uses their responses to complete and file their tax returns electronically through the IRS website. The program guides users through the process step by step, making it easy to navigate.

When Can I Use Direct File?

The Direct File pilot program has short and unannounced availability windows, so taxpayers need to watch when it is open for new users. Those interested can sign up for notifications on the Direct File website to stay informed about the program's availability.

What Are the Benefits of Direct File?

The primary benefit of Direct File is its cost-saving nature; it is completely free to use. Additionally, Direct File simplifies the tax filing process, eliminating the need for third-party tax filing software or professional assistance for eligible taxpayers.

The launch of the Direct File pilot program by the IRS marks a significant step towards making tax filing more accessible and affordable for millions of Americans. By offering a free and user-friendly alternative to traditional tax-filing methods, Direct File aims to streamline the tax-filing process and reduce financial burdens on taxpayers. 

READ NEXT: Tesla, Nissan, GM and Other EV Models Lose US Tax Credits

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