The IRS said on Thursday that, from the next year, its trial Direct File free tax-filing option for streamlined tax returns will be available on a permanent basis.

The IRS and the U.S. Treasury Department stated in a release that 140,000 filers claimed more than $90 million in refunds and saved an estimated $5.6 million in filing costs as a result of the Direct File pilot program, which was implemented on a limited basis earlier this year.

“President Biden is dedicated to ensuring that families receive the tax benefits they are entitled to while also saving Americans time and money.” A free tool for all Americans who wish to file with the IRS directly is essential to accomplishing those objectives, according to a statement released by Treasury Secretary Janet Yellen.

“After a successful pilot, we are making Direct File permanent and inviting all 50 states to offer this free filing option to their residents. The Treasury Department and IRS look forward to working with states to expand Direct File to Americans across the country.”

Direct File is intended for taxpayers who use the standard deduction and have relatively simple tax returns, such as W2s or Social Security income. Other revenue streams, such as gig economy earnings or other business returns, are not accepted.

Direct File is not a substitute for the current filing services and is not a mandated government initiative.

However, proponents have long demanded—especially in the digital age—a program to lower or possibly do away with the filing costs.

“President Biden is focused on lowering costs and making the tax system fairer for Americans, and that includes providing a free and simple way to file taxes, with no expensive and unnecessary filing fees and no upselling,” National Economic Adviser Lael Brainard stated in a statement.

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State income tax payers are required to choose to participate in Direct File. Following accusations from TurboTax parent Intuit that Direct File is a waste of tax payer money, twelve states have already expressed reluctance to doing so.

On the other hand, 90% of respondents to a White House study said they had a “above average” or “excellent” experience with Direct File.

“The numbers speak for themselves: the Direct File Pilot was a success, saving American taxpayers countless hours and millions of dollars filing their taxes,” White House deputy chief of staff Natalie Quillian stated in a statement. “Now, we’re bringing the program to a national audience. It’s just one more example of how President Biden’s Investing in America agenda is lowering costs for communities across the country.”


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