Direct File, a permanent option in 2025.

latexman

Thinks s/he gets paid by the post
Joined
Mar 19, 2014
Messages
2,062
Location
Apex and Bradenton
IRS makes Direct File a permanent option to file federal tax returns; expanded access for more taxpayers planned for the 2025 filing season.

Following a successful filing season pilot and feedback from a variety of partners, the Internal Revenue Service announced today that it will make Direct File a permanent option for filing federal tax returns starting in the 2025 tax season.

Does anyone have experience using Direct File? How was it?
 
Not allowed in Direct File.png

Bummer! DW and I each have a pension. Guess we are staying with TurboTax!

With these restrictions, I doubt many here can use it.
 
Weird. That information comes from documents supplied directly to the government by the financial institution, and the IRS will know if you make entries that don't match. As has been pointed out before, there's really no reason the IRS couldn't just process your taxes for you, and just ask you to accept as is, or submit your own 1040 if you had some other situations not covered.

The IRS already knows every single entry on my form. This whole filing operation is just silly for most filers (they hopefully keep the high standard deduction, that does simplify things for many). Even if you do itemize, that could be just a submission of the deductions, they still have everything else, and can do the math, and you sign off.

Why is this so complicated? I don't make decisions when I file taxes, I follow instructions (that their computers already have).
 
After reading the article, I think the intent of the IRS is to gradually include a broader swath of tax filers. I suspect eventually most anyone will be able to file using Directfile.
 
After reading the article, I think the intent of the IRS is to gradually include a broader swath of tax filers. I suspect eventually most anyone will be able to file using Directfile.
Hopefully they expand this. It could be they are just phasing it in over time, which is probably a good way to go to avoid a major issue. It just started in 2024, so even this step is a pretty positive sign I think. From the IRS:
IRS Direct File was a pilot for the 2024 tax filing season. Following software launch best practices, we started the pilot with a limited number of people to fully test the new service and continuously improved the taxpayer experience.


Using a phased approach
Do the tax preparer corporations have strong enough lobbies/influence (campaign contributions?) to stifle this?
 
Do the tax preparer corporations have strong enough lobbies/influence (campaign contributions?) to stifle this?
I suspect this is the reason some forms are not yet included for this new Direct File option.

Best case would be there is a time limit for the tax preparers that has been communicated to them but not to the public.
 
Last edited:
Why is this so complicated? I don't make decisions when I file taxes, I follow instructions (that their computers already have).
See below...
Do the tax preparer corporations have strong enough lobbies/influence (campaign contributions?) to stifle this?
So far, yes. But this first baby step is interesting. Looks like there's a bit of a fight brewing. My money is on the lobbyists. I hope I'm wrong.
 
The question will be if you dispute their findings or need to make some changes, how customer friendly will they be? I can already hear the horror stories to come!
 
^^^^^ Nothing will change, as right now when you file taxes, if the IRS does not agree. How friendly are they when you dispute their findings :confused:

How you submit the tax form doesn't matter.
 
I think this will save the IRS money, as right now a lot of simple forms are probably done on paper. If I was working and made $40K a year without anything else special, I'd file on paper.

Then the IRS has to scan it in, have a person check it and adjust the scanned info due to my poor writing.

A free file saves the IRS some expense.
 
I think this will save the IRS money, as right now a lot of simple forms are probably done on paper. If I was working and made $40K a year without anything else special, I'd file on paper.

Then the IRS has to scan it in, have a person check it and adjust the scanned info due to my poor writing.

A free file saves the IRS some expense.
Yes, I think that is right. I'm one of the few holdouts that has never used a software package to file my taxes. Years ago you could fill in your tax forms on the IRS into writable PDF files, print them out, and then send them in the mail. That addressed the hand writing issue. Since then, the IRS introduced the Free File Fillable Forms, such that you can e-file your taxes for free, which eliminated them from the the paper forms and envelope issues. I'm sure both of these changes were for the IRS's benefit and not mine.

I will admit that I don't care for keying in all my 1099s when I file, but other than that I kind of like the Free Fillable forms option.
 
^^^^^ Nothing will change, as right now when you file taxes, if the IRS does not agree. How friendly are they when you dispute their findings :confused:

How you submit the tax form doesn't matter.
I was responding to the idea of them doing everything and then you dispute if you disagree. That would be a huge change.
 
I think this will save the IRS money, as right now a lot of simple forms are probably done on paper. If I was working and made $40K a year without anything else special, I'd file on paper.

Then the IRS has to scan it in, have a person check it and adjust the scanned info due to my poor writing.

A free file saves the IRS some expense.

I was surprised by the percents. IRS says 90.7% of individual returns are filed electronically.
 
I think this will save the IRS money, as right now a lot of simple forms are probably done on paper.

A free file saves the IRS some expense.
I disagree. The simple returns are the easiest to file electronically and can already be done for free with a variety of services approved by the IRS. My daughter has e-filed for free (federal and state) for years with FreeTax USA.
 
This morning this appeared from Mike Piper, aka The Oblivious Investor:
At the end of April, the IRS announced that their pilot program Direct File went very well by any measure. Now, they’ve announced that the program will be made permanent, and access will be expanded both in terms of available states and tax situations covered.

Without exaggeration, I think this is the best development we’ve seen in the tax world during my entire time in the industry.

Hoping that a few of the ineligible income sources in post #3 above become included, as well as the ability to fully integrate withy my state (AZ) tax. Having to do state taxes manually would likely be a showstopper for me.
 
Back
Top Bottom