We have bad news. Republicans want to eliminate Direct File, the free IRS tool that allows you to file your taxes easily and simply. This proposal has been pushed from the House of Representatives and, of course, backed by President Trump, obviously… What’s going on? This tax bill is 389 pages long and requires the Secretary of the Treasury to terminate the IRS’s Direct File system. Why? Because supposedly it had issues that prevented it from functioning properly.
Will Direct File cease to exist?
The argument from Republican lawmakers is clear: they consider this system an unnecessary expense and an example of government overreach. But Democrats, on the other hand, defend its continuation and highlight its efficiency, even proposing that it be managed by the Department of Government Efficiency (DOGE), which as you know, hasn’t exactly been quiet these past months.
What is Direct File?
Direct File is an IRS (Internal Revenue Service) tool that allows U.S. taxpayers to file their taxes for free, without the need for intermediaries. It became the favourite way for taxpayers to file because it avoided the cost of private tax software, it was direct and fast. But its growth has caused friction among those who support less government intervention in fiscal matters.
What does the bill say?
The bill (which, as we said, has 389 pages) includes a specific clause to cancel this system within 30 days of approval…
It also authorizes the Treasury Department to allocate up to 15 million dollars to study a new public-private model that would allow at least 70% of citizens to file their taxes for free.
But there’s more: the law also requires the new report to analyse taxpayer opinion on the different models: one funded by the government, one by users, or a third one managed by private companies.
Donald Trump’s position
Of course, Trump has shown explicit support for this proposal. His administration seeks to reduce the size of public tools and increase the role of the private sector, aligning with a more conservative vision of public management, as carried out by DOGE led by Elon Musk.
What would eliminating Direct File imply?
Eliminating Direct File would mean going back to relying entirely on commercial tax software, which could translate into additional expenses for millions of people, especially those with modest incomes who are trying to meet their tax obligations for free…
In addition, a platform that was being improved to cover more complex cases and adapt to different taxpayer profiles would be lost. Its accessibility, especially from mobile devices, also represented progress in terms of digital inclusion.
A step back in the modernization of the IRS?
Many experts believe that eliminating Direct File would hinder the IRS’s efforts to digitize and simplify the tax filing process. While other countries move toward automated and free systems, the U.S. could be stepping back into greater dependence on others…
It’s not just the proposal to eliminate Direct File, they also want to cut at least 880 billion dollars in public “spending,” with an emphasis on Medicaid programs, which provide medical coverage for low-income or disabled people. Is that really spending?
The truth is that, if this bill is approved, millions of taxpayers could be forced to pay for something they’ve been doing for free until now. And in the middle of such a tense political situation, fair and equal access to tax services is once again at the centre of the debate…