Six reasons to promote IRS Direct File now
Editor’s note: Roxy Caines of the Center on Budget and Policy Priorities serves as the Get it Back Campaign Director.
By Roxy Caines
As Tax Day nears, the need to connect more eligible people to Direct File, a new digital tax filing tool from the IRS, is becoming more urgent. Direct File allows eligible taxpayers to file their taxes directly with the IRS securely, quickly, and for free. April 15 is the last day for most eligible filers to use IRS Direct File during this pilot year. Direct File is available in the following 12 states: Arizona, California, Florida, Massachusetts, New Hampshire, New York, Nevada, South Dakota, Tennessee, Texas, Washington, and Wyoming.
Here are six reasons to promote Direct File during these final days of the tax season.
1. Direct File increases tax equity.
The Direct File pilot, part of the IRS’ strategic operating plan and modernization of the tax filing system, is one way funding from the Inflation Reduction Act has helped the IRS to improve the taxpayer experience. Direct File is the first electronic tax filing tool designed completely by the IRS, which the agency created and launched in under a year. By lowering the cost and lessening the complexity of tax filing, Direct File can increase the equity of the tax system.
2. Direct File is thoughtfully designed and well-tested.
The IRS has prioritized the tax filer throughout each stage of the Direct File pilot. As the agency designed the tool, it conducted multiple user testing sessions to understand and incorporate the needs of filers with low and moderate incomes. Once Direct File was ready for use, the IRS opened it up in phases, starting with IRS employees, to allow for further testing and refinement. This iterative approach contributed to a successful public launch on March 12. The IRS expects at least 100,000 taxpayers to use Direct File this year.
3. Direct File is a people-centered tax tool.
Direct File has elevated the tax filing industry by providing an option that reflects the needs and experiences of tax filers with low to moderate incomes. Direct File offers a screener tool for people to check their eligibility before starting to use the tool; is mobile-friendly; is available in English and Spanish; provides daily, live customer support by trained IRS representatives; uses interview-style prompts for people to populate their tax return; and prioritizes security and fraud prevention.
4. Direct File helps taxpayers reclaim their time and save their money.
One of the greatest benefits of Direct File is the time and money it can save users. Direct File is completely free to use – including its seamless integration to file state tax returns in participating states, which some tax filing software companies charge for even if they file the federal returns for free.
The IRS estimates that an average taxpayer spends nine hours and $150 each year filing taxes. Many Direct File users have shared that they completed their taxes in less than one hour, including time spent contacting live support. Within five years, Direct File could save users as much as $11 billion annually, according to the Economic Security Project.
5. Taxpayers support Direct File.
Direct File has received broad taxpayer support. The IRS’ 2022 Taxpayer Experience Survey found that 73 percent of taxpayers would be “very interested” or “somewhat interested” in using an IRS-provided free online tax filing tool. In February, between 90 and 95 percent of respondents supported Direct File in a five-state poll.
This support is consistent with Direct File user feedback, which has been overwhelmingly positive. The first Direct File user, Dixie Warden, said, “I don’t want to call myself a dummy, but this is taxes for dummies right here.”
6. More Direct File users can help the program to grow.
After the tax season, the IRS will evaluate the Direct File pilot to determine if it will continue and expand. More Direct File users will generate more data, helping to determine the future of Direct File.
So, what can you do to help promote Direct File to the nearly 30 percent of people who wait until April to file their tax returns? The Coalition for Fair and Free Filing (CFFF) has created outreach materials in English and Spanish in addition to the IRS’ Direct File outreach resources that any anyone can use to spread the word that eligible tax filers can file their taxes for free with Direct File.
Four things you can do to promote Direct File now:
- Link to IRS Direct File (https://directfile.irs.gov) on your website. This will help Direct File show up higher in search engines when people do internet searches. For example, you can post, “Tax Day is almost here! Find out if you are eligible to file your taxes for free with Direct File.”
- Email your network about Direct File. Encourage them to use Direct File and to tell others about it. Not in a pilot state? This is an important time to plan and advocate for Direct File to expand in the future. Invite non-pilot states to join the CFFF Direct File expansion working group here.
- Send a text message to your network and encourage those in pilot states to do the same. If your organization doesn’t have texting capacity, text a friend!
- Post about Direct File on social media.
Now is the time to help make the IRS Direct File pilot a success!