'Under the radar' plan to kill beloved tax filing program hidden in GOP bill

[BumRushDaShow]

Source: Raw Story

May 15, 2025 10:49AM ET


In addition to showering rich Americans and large corporations with more tax breaks, legislation that Republicans advanced out of committee on Wednesday would officially eliminate the Internal Revenue Service's popular and free Direct File program, which allowed eligible taxpayers to sidestep private prep companies that have lobbied relentlessly against government-offered alternatives for decades.

The tax legislation that the GOP-controlled House Ways and Means Committee approved in a party-line vote contains an underlooked provision that requires the U.S. Treasury Department to "ensure that the Internal Revenue Service Direct File program has been terminated." The bill also opens the door to a "partnership between the IRS and private-sector tax preparation services to provide for free tax filing" to replace Direct File, which has been in the crosshairs of the Trump administration and the Elon Musk-led Department of Government Efficiency.

Watchdogs said the measure's language reeks of corporate influence. "Corporate monopolist Intuit spent millions lobbying Republicans to insulate TurboTax from competition," said Hannah Garden Monheit, a senior fellow at the American Economic Liberties Project. "Now, House Republicans are doing Intuit's bidding by killing the Direct File program, which provided free, simplified public tax filing software beloved by its users."

"Direct File saves the average American $160 in filing fees and hours of time each year, and continuing it would save $11 billion annually," she added. "Expanding and improving Direct File should've been an easy win for DOGE, but clearly corporate cronyism is more important to Republicans than lowering costs for ordinary Americans and increasing the efficiency of government services." "Trump will force you to fork out hundreds of dollars each year to TurboTax so he can give tax breaks to billionaires."

Read more: https://www.rawstory.com/tax-filing-irs/

[erronis]

1. this absolutely stinks. HRBlock, Intuit, etc. have bought congress (no surprise)

For anyone who wants a free and open source set of spreadsheets that do 95+ of most people's federal taxes, I highly recommend Glenn Reeves open source workbook. It contains many schedules and worksheets. It can be run directly in google sheets (privacy concerns should be noted) or locally in Excel or LibreOffice Calc.

https://sites.google.com/view/incometaxspreadsheet/home/download

[BumRushDaShow]

2. PA had finally made it to the list in 2024

and I had originally planned to use Direct File but with the election, I knew it would probably be DOA, so I began to back away. And then with the DOGE massacre, I didn't even bother because I didn't want my returns to end up caught in the boondoggle - especially since this was my first year adding SS to the mix (along with having done voluntary withholding of taxes from that).

[Linda ladeewolf]

3. I hate this!

I’ve used the free file thing since I found it. It takes 15 minutes or the preparer to do it and file the papers. I haven’t been back to intuit since. Even if they do away with it, I won’t use Inuit again. I’ll go back to filing my own stuff again.

[erronis]

4. Intuit lost my trust a long time ago when they installed a root-kit on my Windows PC.

A root-kit is a piece of viral software that can't be detected by normal anti-virus solutions. It took quite a bit of effort to rid this worm from my machine.

Sony did the same to me, but I somewhat trust them more....

Moved to Linux and will never allow a platform like Windows to host what I think is important (I don't play games.)

[Karasu]

5. They have so much bullshit hidden in this abomination that it's absurd. The no regulation on AI for 10 years thing is

easily the fucking worst and can't be allowed to happen, but this is pretty awful as well.

They should not be allowed to do this and the fact that they can is one of the greatest flaws of the legislative system in this country. Fuck all unrelated riders and provisions.

[Silent Type]

6. Not sure about "beloved." First, program didn't start until 2024, only offered in 25 states, and only 140K used it.

Maybe it would grow over time, maybe not. The IRS Free File still exists, about 950 K used that.

[BumRushDaShow]

7. There were already a lot of people using "Free File"

almost 1 million last year. But for those who didn't meet the criteria, this would have been a godsend.

[progree]

8. And I didn't qualify because my AGI was a little bit too high. And there were some things it couldn't handle

including some of my stuff. But I hoped it would become more capable and raise the AGI limit, perhaps with a sliding scale fee.

One thing that for me is a nightmare is the foreign tax deduction / foreign tax credit, which -- even with TurboTax with all of its experience --makes it into an impossible - to - understand and to have any confidence that I did it right, but so far, over the past 7 years or so that I've used TurboTax, I haven't had an issue with what I submitted.

[Silent Type]

9. It would have been nice if they enhanced it. For starters they could import a lot of income (wages, most investments,

etc.). You definitely have a complicated situation for most software. Will be interesting to see what AI does for software. Wonder if they’ll give Muskittes a chance?

I’m convinced one reason the government keeps free filing to simple returns, is that they can’t figure the more complicated stuff out precisely and the agency heads don’t want to take blame for screwing up.

[progree]

11. "one reason the government keeps free filing to simple returns..."

I’m convinced one reason the government keeps free filing to simple returns, is that they can’t figure the more complicated stuff out precisely and the agency heads don’t want to take blame for screwing up.

Yes. And also with more complex returns, they'd be getting a lot more technical support calls, and more difficult ones ...

DU member "question everything" has posted quite a lot about his interactions with TurboTax technical support over the years. I could post a lot of stories too.

I know I shouldn't say this on a progressive website, but I think they earn their fees. I've used a professional tax preparer for 35 years before I switched to TurboTax. Even my tax preparer's software had issues.

Another one: paying taxes on IRA withdrawals -- OK, that's real common (I'm not 73 yet, but one has to take RMDs on inherited IRAs no matter what age, and pay taxes on the withdrawals). But some of my IRA contributions way back in the 80's were non-deductible. I could explain further but enuf. Anyway, that flabbergasted TurboTax in the last 2 years, and it also flabbergasted my tax preparer's software in the last 2 years or so that I used him. We both had to shoe-horn in some numbers to make it come out right.

[slightlv]

10. Once again,

we see if a program or service actually provides efficacy of service to the general population of Americans, Repugs will strip it and send the profits to all the Corporate Big Brothers. There've been a few articles today that specifically mentioned the Middle Class... I'm convinced we no longer have a true middle class. There are only two classes of people in the U.S. - rich/well off and poor/struggling. Unless we can wrench back our government, we'll be forever at the serf level of life here in the states. John Edwards had it right with his slogan "The Two Americas"... if only he'd been more respectful of his wife and marriage vows (sigh).

[wolfie001]

12. Sleazy, scummy POS party

These are psychotic, hateful a-holes.