Taxpayers in 12 states are now able to file their taxes for free, thanks to the IRS’s new online tool.
Direct File is an attempt to compete with commercial companies, such as TurboTax, for direct filing.
“We will be working closely with the 12 pilot states in this test run, which will help us gather information about the future direction of the Direct File program,” IRS Commissioner Danny Werfel said.
The site is open to taxpayers in Arizona, California, Florida, Massachusetts, Nevada, New Hampshire, New York, South Dakota, Tennessee, Texas, Washington, and Wyoming. Alaska, originally included, is no longer part of the pilot program. The website doesn’t support state returns, but taxpayers in Arizona, California, Massachusetts, and New York will be directed to a state-supported tax preparation pool.
During its pilot season, the Direct File site supports limited tax situations. A testing period of the site will run from March 4 to March 12. The website will then fully open the site to all eligible users on March 12. The website said the IRS will use the information from the testing period in the future to “continue improving the experience of tax filing.”
Only those with straightforward tax returns will be eligible for the pilot program.
Eligibility income options include W-2 wage income, SSA-1099 Social Security income, 1099-G unemployment compensation, and 1099-INT interest income of $1,500 or less.
CLICK HERE TO READ MORE FROM THE WASHINGTON EXAMINER
The pilot program is not available for those with other types of income, such as contracted workers, gig economy workers, or self-employed filers.
Taxpayers must claim the standard deduction for tax breaks. Direct File only accepts a few credits: earned income tax credit, child tax credit, and credit for other dependents. The site also accepts deductions for student loan interest and educator expenses.
