If there's one thing we should be able to agree upon, it's that everyone should pay the taxes they owe without having to pay for the privilege of doing so. This year, for the first time, residents of 12 states who file simple tax returns can file online for free using the IRS's new Direct File portal.
Direct File can be used to claim child and earned income tax credits, providing valuable support to millions of working families. In fact, helping families claim these credits by eliminating the cost of tax filing may be one of Direct File's most important contributions. In 2020--the most recent year for which data are available--nearly one out of every four individuals eligible for the EITC didn't claim the credits they were owed.
Direct File is also designed to meet the needs of other segments of the public who aren't served by existing private systems. Filers can prepare their returns on a smartphone, tablet or desktop, and real-time online support is available weekdays and evenings in Spanish and English from a live IRS professional, not an AI-powered chatbot.
Early reviews of Direct File show strong support, with users reporting it as "the fastest I've ever done my taxes" and "honestly the easiest tax experience I've ever had." One reporter said that "the government has created an actually good piece of software."
The enthusiastic response to a free online filing option shouldn't be surprising. The typical taxpayer spends 13 hours and $270 each year preparing a federal tax return. Money saved by filing for free is money back in families' pockets--money that can be used for rent, groceries and other necessities.
To scale the pilot to more tax filers in more states, the IRS must work quickly with state tax administrators to ensure filers who wish to use a public option can seamlessly file their federal and state tax returns. It will also require sustained support and the funding needed to reverse a decade of disinvestment and rebuild the IRS to improve customer service and ensure the nation's tax laws are enforced effectively.
In the meantime, if you qualify for the Direct File pilot and have yet to complete your tax return, there's still time to check it out. If you've finished your taxes, give yourself a well-deserved pat on the back. For all of us--filed or yet to file--the new Direct File tool represents government at its best: saving families time and money. That's something to cheer about. Happy Tax Day!
Jean Ross is a senior fellow for economic policy at the Center for American Progress. She wrote this for InsideSources.com.