Groundwork’s DiVito: The End of Direct File Is a Win for Corporations and Loss for Working People
Groundwork’s DiVito: The End of Direct File Is a Win for Corporations and Loss for Working People
This week, IRS Commissioner Billy Long confirmed that the agency is shuttering its Direct File program after just two filing seasons. In its brief tenure, the program saved taxpayers millions of dollars in filing fees and was overwhelmingly popular with taxpayers.
Groundwork Collaborative’s Senior Advisor for Economic Policy Emily DiVito reacted with the following statement:
“The Trump Administration’s decision to end the IRS’s Direct File program is a clear win for corporate tax prep giants and a real loss for working people. Direct File was proof that the government can work for all of us; not just the wealthy and well-connected. At a time when the Republican budget law will make life harder and more expensive for families, shutting down Direct File will cost taxpayers millions in filing fees and wasted time each year.
“Billy Long’s decision to end the program confirms what we already knew: this Administration doesn’t care about making life easier and more affordable for working families.”
BACKGROUND
- Direct File is a secure, simple, and always free tax filing option provided by the IRS to help reduce the cost and take out the headache of filing taxes. The tool was first introduced as a pilot in 12 states for the 2024 tax season. Since then, it’s grown to 25 states and 32 million eligible users.
- Polling from Groundwork Action and Data for Progress demonstrates overwhelming support for expanding the Direct File tool nationwide to all Americans. The poll reveals a staggering 82% of likely voters across all political affiliations support expanding this critical tool.
- Direct File is incredibly popular among taxpayers. Last year, 90% of surveyed users rated their experience as excellent or above average. Most users said they filed their taxes in less than an hour.
- Direct File is a guaranteed way to make the government more efficient and provide better customer service.
- Before Direct File, Americans spent 1.7 billion hours or $31 billion annually to file their taxes, even though the overwhelming majority should be able to file in mere minutes and for free.
- For every dollar invested in the program, Direct File saves American taxpayers $160. In 2024, the Treasury Department estimated that Direct File users saved $5.6 million in tax preparation fees.
- Unfortunately, this tax season was also marked by administrative uncertainty. Trump and DOGE’s attacks on the IRS and government agencies more broadly — including cuts to the Taxpayer Advocate Service and the team running Direct File — sabotaged the widely popular tool.
