IRS Direct File Pilot Program

Originally Published on 3/28/24

The IRS has introduced its own Direct File tax preparation service to certain taxpayers. The pilot program is currently open to taxpayers in twelve states. Only taxpayers with certain types of income, including W income, interest income reported on Form 1099-INT, Social Security income and unemployment compensation are eligible. Only taxpayers who take the standard deduction and have deductions for student loan interest or educator expenses can use the platform, and taxpayers are similarly ineligible if they claim credits aside from the earned income tax credit, child tax credit or credit for other dependents. The program is free of charge and walks taxpayers through the tax preparation process. Some critics have, however, claimed that the program will create a conflict of interest.

We asked two professors and authors of ALM’s Tax Facts with opposing political viewpoints to share their opinions about whether the IRS direct file pilot program creates a conflict of interest.

Below is a summary of the debate that ensued between the two professors.