IRS Direct File won’t be available next year. Here’s what that means for taxpayers

WASHINGTON (AP) — IRS Direct File, the electronic system for filing tax returns for free, will not be offered next year, the Trump administration has confirmed.

An email sent Monday from IRS official Cynthia Noe to state comptrollers that participate in the Direct File program said that “IRS Direct File will not be available in Filing Season 2026. No launch date has been set for the future.”

The program developed during Joe Biden’s presidency was credited by users with making tax filing easy, fast and economical. However, it faced criticism from Republican lawmakers, who called it a waste of taxpayer money because free filing programs already exist (though they are difficult to use), and from commercial tax preparation companies, which have made billions from charging people to use their software.

Treasury Secretary Scott Bessent, who is also the current IRS commissioner, told reporters at the White House on Wednesday that there are “better alternatives” to Direct File. “It wasn’t used very much,” he said. “And we think that the private sector can do a better job.”

The Center for Taxpayer Rights filed a Freedom of Information Act request for IRS’ latest evaluation of the program and the report says 296,531 taxpayers submitted accepted returns for the 2025 tax season through Direct File. That’s up from the 140,803 submitted accepted returns in 2024.

Direct File was rolled out as a pilot program in 2024 after the IRS was tasked with looking into how to create a “direct file” system as part of the money it received from the Inflation Reduction Act signed into law by Biden in 2022. The Democratic administration spent tens of millions of dollars developing the program.

Last May, the agency under Biden announced that the program would be made permanent.

But the IRS has faced intense blowback to Direct File from private tax preparation companies that have spent millions lobbying Congress. The average American typically spends about $140 preparing returns each year.

The program had been in limbo since the start of the Trump administration as Elon Musk and the Department of Government Efficiency slashed their way through the federal government. But The Associated Press reported in April that the administration planned to eliminate the program, with its future becoming clear after the IRS staff assigned to it were told to stop working on its development for the 2026 tax filing season.

As of Wednesday, the Direct File website states that “Direct File is closed. More information will be available at a later date.”

The Washington Post and NextGov first reported on the email to state comptrollers confirming the program would not be offered next year.

Adam Ruben, a vice president at the liberal-leaning Economic Security Project, said “it’s not surprising” that the program was eliminated.

“Trump’s billionaire friends get favors while honest, hardworking Americans will pay more to file their taxes,” he said.