Filing Taxes Is About To Get Easier for Many Americans

Free federal tax filing is here to stay. The Internal Revenue Service (IRS) has officially invited every U.S. state to offer its Direct File program to American taxpayers starting next year.

The service was piloted across twelve states in the 2023 tax season, and successfully processed 140,000 returns, helping save Americans a whopping $5.6 million in filing fees.

Praise and Pushback

Direct File has garnered strong support from many Americans. In an IRS survey of taxpayers who used the service, the vast majority gave it a positive review (90%) and said it increased their trust in the IRS (86%).

But where does this leave companies like H&R Block (HRB) and TurboTax-owner Intuit (INTU)? Both companies have pushed back against the IRS program, arguing that it is redundant to tax filing services already offered in the private sector. The IRS maintains that Direct File is not meant to replace those services.

Free Tax Filing

All states will now have the option to offer Direct File for the 2024 tax year, meaning next year’s filings. However, it’s still to be seen if all states will opt in and make Direct File available.

Additionally, the service is currently intended for filing simple returns only. The IRS plans to expand it to accommodate more complex tax situations in the future.

Looking for more stories like this? Check out On the Money — SoFi’s one-stop-shop for news, trends, and tips!

Check it out

Please understand that this information provided is general in nature and shouldn’t be construed as a recommendation or solicitation of any products offered by SoFi’s affiliates and subsidiaries. In addition, this information is by no means meant to provide investment or financial advice, nor is it intended to serve as the basis for any investment decision or recommendation to buy or sell any asset. Keep in mind that investing involves risk, and past performance of an asset never guarantees future results or returns. It’s important for investors to consider their specific financial needs, goals, and risk profile before making an investment decision.

The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. These links are provided for informational purposes and should not be viewed as an endorsement. No brands or products mentioned are affiliated with SoFi, nor do they endorse or sponsor this content.

Communication of SoFi Wealth LLC an SEC Registered Investment Advisor

SoFi isn’t recommending and is not affiliated with the brands or companies displayed. Brands displayed neither endorse or sponsor this article. Third party trademarks and service marks referenced are property of their respective owners.
SOSS24060403