Washington, D.C. – United States Senators Elizabeth Warren (D-Mass) and Tom Carper (D-Del.), alongside Representatives Brad Sherman (D-Calif.), Katie Porter (D-Calif.) and Don Beyer (D-Va.), led a coalition of 99 Democratic lawmakers in sending a letter to Internal Revenue Service (IRS) Commissioner Daniel Werfel and Deputy Treasury Secretary Adewale Adeyemo, applauding the IRS’ announcement of a pilot of a free tax filing tool next year. The lawmakers shared their support for making a strong tool available to as many taxpayers as feasible in 2024 and for continuing to build the free and easier tax filing tool that Americans want and deserve.
Last month, the IRS released its long-awaited report demonstrating the feasibility and importance of a free, government-owned direct file tool, and announced its intention – at Treasury’s direction – to pilot such a tool during the next filing season. The tool will save many hardworking Americans the $140 on average they pay to file their taxes, and help provide low-income taxpayers the opportunity to claim thousands of dollars in benefits that have been missed due to the expense and difficulty of filing a return. The report also revealed that taxpayers would feel overall more secure filing their taxes directly with the government, than through a private tax software company.
“We urge you to make this pilot of the direct file tool available to as many taxpayers as is feasible, in order to deliver real value quickly to American taxpayers and demonstrate the value of modernizing the IRS, while also gathering data to make improvements and to better serve American taxpayers,” wrote the lawmakers. “We also know that next year’s pilot is only the first step toward the robust direct file system that Americans deserve.”
The lawmakers noted that the average American spends eight hours and $140 every year filing their personal taxes, often turning to tax preparation services that “should be free, are advertised to be free, but all too often are, in fact, not free for taxpayers.” The Free File program, a partnership with private tax preparation companies, was supposed to serve 70 percent of taxpayers but reached only 2 percent in the 2022 tax year.
“This broken system is not only an unauthorized tax on middle-class families, but also a significant obstacle to the IRS fulfilling its role as our country’s second-largest benefits administrator,” wrote the lawmakers. “The expense and difficulty of filing a tax return prevents millions of American families every year from claiming thousands of dollars in benefits Congress has authorized via the Earned Income Tax Credit (EITC) and Child Tax Credit (CTC).”