Sponsors (41)
The bill expands a free, accessible government tax-preparation and filing option that could lower costs and increase access for many taxpayers, but it risks disrupting private tax-prep markets, raising privacy and legal-transition concerns, and increasing federal spending.
Most taxpayers — especially low-income and underserved filers — gain access to a free, government-operated online tax preparation and filing service with prefilled returns, plain-language, multilingual, and mobile interfaces, reducing software costs and improving filing accuracy and uptake.
Taxpayers retain the option to use Treasury-provided tax-preparation services because the Secretary cannot be barred from offering them, and existing contracts that block those services are voided quickly, restoring a public-sector alternative.
Residents in states that choose to participate can file federal and state returns together through integrated state filing, simplifying compliance and reducing time spent on taxes.
Private tax-preparation companies and related vendors could lose contracts, revenue, and market share if Treasury resumes or expands free services, potentially reducing private-sector competition and jobs in tax-prep services.
Federal operation and increased data sharing with states raise privacy and data-security risks for taxpayers if safeguards fail, potentially exposing sensitive financial information.
Errors in prefilling or automated preparation do not remove taxpayers' legal responsibility for accuracy, so filers could still face penalties or audits based on incorrect prefilled information.
Based on analysis of 6 sections of legislative text.
Introduced February 26, 2026 by Elizabeth Warren · Last progress February 26, 2026
Prohibits the Treasury Secretary from entering into (or continuing) agreements that restrict the Treasury/IRS from offering tax return preparation, tax-prep software, or filing services, and voids prior restrictive agreements after 30 days. Directs the IRS to build and operate a federally owned, no-fee online tax preparation and filing service for individual income tax returns that uses IRS records to prefill returns, provides plain-language, multilingual and accessible interfaces, offers integrated support (including live chat), and can file state returns for participating States; it also establishes state integration grants, reporting requirements, and authorizes appropriations. The program must be prominently offered, broadly promoted, user-tested, and free to taxpayers; it preserves taxpayer responsibility for return accuracy and requires the Treasury/IRS to report usage and plans to reduce barriers. The measure also amends certain information-return filing deadlines and takes effect for returns for taxable years beginning after December 31, 2025.