Sponsors (3)
The bill would expand free, standardized federal e-filing that cuts costs and improves access for many taxpayers—especially low- and moderate-income filers—while shifting administrative costs to states and reducing business for private tax-preparation firms.
Taxpayers nationwide would be able to file federal tax returns for free through a government-run online system, lowering out-of-pocket tax-preparation and software costs.
Low- and moderate-income filers would face fewer barriers to filing because a standardized, no-cost federal filing option (with state participation) would simplify the process and increase accessibility.
State governments would incur administrative and IT integration costs to participate in a federal filing system, potentially requiring new budget allocations or technical work.
Private tax-preparation companies and their employees would likely lose market share and revenue, potentially costing jobs and reducing paid service options that some consumers prefer.
Based on analysis of 2 sections of legislative text.
Requires the Treasury to keep IRS Direct File running and mandates all 50 states and D.C. participate for tax years after Dec 31, 2025.
Official title: To direct the Secretary of the Treasury to continue to implement Direct File, and for other purposes.
Introduced June 30, 2025 by Emilia Strong Sykes · Last progress June 30, 2025
Requires the Treasury Secretary (or delegate) to keep operating the IRS’s free Direct File electronic tax return system and mandates that every state and the District of Columbia participate for tax years beginning after December 31, 2025. The law simply names the act and directs continued operation and nationwide state participation; it does not create new tax benefits or appropriate funds.