For now, the only way parents can sign up is by submitting a form with their tax returns.
“Direct File worked really well, and it's a great example of how the IRS can do technology, or how the government can do technology, effectively,” said former IRS Commissioner Daniel Werfel.
The Trump administration says the Free File program offered through commercial tax preparation companies is a more effective option.
The money the IRS spends on tax collection, enforcement and services pulls in much more revenue to fund government operations.
Tax preparation costs are sharply higher this year as the demand for preparers has risen. Software prices have also increased.
Blame the termination of benefits that came with pandemic emergency measures.
The idea has been thrown around for a while now, but new IRS funding may help it become a reality.
Some 6 million returns from last year have yet to be processed. Delays could snowball for seasons to come.
Taxes got extra complicated in 2020, and the IRS has a backlog of 30 million returns that need a manual review.
“Return free filing” is something 36 countries already do.
