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The IRS introduces Direct File, a trial initiative offering free online tax filing, accessible in 12 states.

Following weeks of testing, taxpayers from 12 selected states now have access to an electronic system allowing direct filing of returns to the IRS.

Dubbed Direct File, this free online tool is geared towards taxpayers in the aforementioned states with straightforward W-2s and standard deduction claims. Eligible individuals can utilize this program during the current tax season to submit their federal income taxes. Additionally, a Spanish version of the tool will be made available starting at 1 p.m. Eastern Time on Tuesday.

The Treasury Department estimates that around one-third of all federal income tax returns filed could utilize Direct File, potentially benefiting 19 million taxpayers this tax season.

National Economic Advisor Lael Brainard emphasized the tool’s aim to provide a free and uncomplicated method for tax filing, aligning with President Biden’s commitment to reducing costs for working families.

Participating states include Florida, New Hampshire, Nevada, South Dakota, Tennessee, Texas, Washington, Wyoming, Arizona, Massachusetts, California, and New York. It’s important to note that Direct File solely facilitates the filing of federal income taxes; taxpayers from states requiring state tax filings will need to handle those separately.

Direct File’s pilot program forms part of the agency’s broader initiative to develop a new government service that could potentially replace certain taxpayers’ reliance on commercial tax preparation software like TurboTax. The tool is designed to be user-friendly, offering a step-by-step guide through straightforward questions.

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