Some taxpayers will soon qualify for Direct File, a free tax-filing platform from the IRS. Here's what taxpayers can expect this season.
  • Some taxpayers will soon qualify for Direct File, a free tax-filing option from the IRS.
  • The pilot will begin as an invitation-only service before rolling out to certain taxpayers in 12 states by mid-March.
  • In 2023, individual U.S. taxpayers spent an average of $150 to prepare and file returns, according to the IRS.

As the tax season kicks off next week, Americans have several free filing options — and some taxpayers will soon qualify for a new offering from the IRS.

Known as Direct File, the agency’s free filing software pilot will begin as an invitation-only service for a group of government workers before rolling out to certain taxpayers in 12 states by mid-March.

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Direct File comes after a feasibility report authorized by the Inflation Reduction Act. The report found nearly three-quarters of taxpayers expressed interest in a free IRS-provided filing system.

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Eligible states will include Arizona, California, Florida, Massachusetts, Nevada, New Hampshire, New York, South Dakota, Tennessee, Texas, Washington and Wyoming.

  • Flying Squid@lemmy.world
    0·
    1 year ago

    This is how taxation should work in the U.S. if we were sane:

    1. The IRS sends you a bill or a refund.
    2. You pay it or deposit it.

    The end.

    The IRS should be calculating what we owe. We shouldn’t be doing that ourselves or hiring people to do it for us. Maybe we could finally get the wealthy to pay their fair share.

    • Delphiantares@lemmy.world
      0·
      1 year ago

      Or dispute it . This is how it’s done almost everywhere else but the tax lobby have a best interest in this not working this way.

      Or…you know bring back home ec classes that teach kids how to survive in the world instead of assuming parents will be able to do it

      • Flying Squid@lemmy.world
        0·
        1 year ago

        Sure, bring back home ec classes like that regardless, but that should also have no bearing on a saner taxation system. The one we have is ludicrous.

    • Ottomateeverything@lemmy.world
      0·
      1 year ago

      The IRS should be calculating what we owe.

      They do. That’s why you occasionally get bills saying “hey you miscalculated by 70 bucks.” They already do the work, they just still make us do it too for… Reasons.

      • I_Fart_Glitter@lemmy.world
        0·
        1 year ago

        Once for a whole year I would get a letter saying “You underpaid by $30, plz pay.” So I would pay. Then I would get a letter saying “You overpaid by $30, here is check.” So I would cash it. Then I would get a letter saying “You underpaid by $30, plz pay…” There were six or seven of those exchanges. I didn’t cash the last check and the letters stopped coming. 🤷‍♂️

      • Flying Squid@lemmy.world
        0·
        1 year ago

        Are you saying your taxes aren’t taken out of your paychecks? Because they’ve always been taken out of mine. Seems like it’s pretty easy for them to bill you based on that. And they can send the bill to whatever address is on your W-2.

          • Flying Squid@lemmy.world
            0·
            1 year ago

            Even if it only took you 15 minutes, and it sure takes a lot of people who get W-2s a lot more than 15 minutes… that’s 15 minutes too long. Why should you have to do the government’s job for it?

              • Flying Squid@lemmy.world
                0·
                1 year ago

                The government should already have a record of how much you’ve been paid every year. Why do they not have that record in your case? Do you not declare your income in whatever job you have?

                  • Flying Squid@lemmy.world
                    0·
                    1 year ago

                    Oh well. Guess you don’t get to benefit from something everyone who isn’t self-employed should benefit from.

                    Nah, let’s leave the tax code impossibly complicated and easy for rich people to game on behalf of the handful of self-employed people in this country.

                    Tell you what, you keep doing your 15-minute taxes and the rest of us won’t have to waste those 15 minutes. How’s that?

      • OldWoodFrame@lemm.ee
        0·
        1 year ago

        All info on the tax forms you use for your taxes could just be sent to the government instead, and they can calculate your taxes. That is how it works in most other countries.

    • kingshrubb@lemmy.world
      0·
      1 year ago

      Agree. Then TurboTax and other tax preparers wouldn’t be able to rip us off to the tune of billions of $ too.

    • RegalPotoo@lemmy.worldEnglish
      0·
      1 year ago

      As an example of how this could work based on how it does where I live;

      • When you get a job, open a bank account or a shareholding account you fill in a form telling them your IRD number and tax code. There is a flow chart on the back of the form to help you work out what your code is, but it is derived from the amount of income you expect to earn throughout the year and if you have any special statuses that significantly change how you pay tax (eg, of you have a student loan or owe child support)
      • Before you are paid (your income, dividends, interest, profit from share sales etc), the party paying you uses your tax code to determine the percentage tax you owe, then sends the tax plus a filing directly to the IRD on your behalf
      • At the end of the tax year, IRD looks at all the filings, totals up all your income, totals up all the tax you’ve paid, checks if you are eligible for certain tax credit, and works out if you’ve paid the right amount of tax
      • You get notified of the outcome, and get a chance to correct it (eg, if you’ve made charitable donations and want to claim a credit based on that etc)
      • Once the filing is finalised (which happens automatically if you do nothing) you either get a bill in the post, a cheque, or the money deposited directly into your bank account if you’ve nominated one - unless you owe them less that $10, in which case you get a letter saying that they’ve written the debt off and you owe nothing

      No muss, no fuss. If you’ve got an interest in a trust or own a company then it gets a bit more complicated and you might need an accountant to file for you, but for 95% of people it’s free, happens automatically, and they aren’t stuck with a big bill at the end of the year

      • HubertManne@kbin.social
        0·
        1 year ago

        yup. we should all be recieving a 2040x with the left hand side filled out already and we can optionally make the changes in the right hand side if we think its wrong.