The IRS direct filing system is expanding to new states and tax scenarios.
Is your state among them?
The IRS Direct File program will expand to new states and tax situations. For the 2025 tax filing season, the program will be available to residents of 12 new states: Alaska, Connecticut, Idaho, Kansas, Maine, Maryland, New Jersey, New Mexico, North Carolina, Oregon, Pennsylvania, and Wisconsin. These states join the 12 that already participated this year, which are Arizona, California, Florida, Massachusetts, Nevada, New Hampshire, New York, South Dakota, Tennessee, Texas, Washington, and Wyoming. This means that over 30 million taxpayers across the country will have access to Direct File.
The remaining 26 states are not part of Direct File and have not yet opted to join the program. Direct File allows eligible taxpayers to file their taxes directly with the IRS using software developed by the agency. This service is accessible on mobile devices, laptops, tablets, and desktop computers. For the 2025 tax season, the IRS plans to enhance Direct File by adding a chatbot that will help taxpayers verify their eligibility and address new tax situations.
This year, only taxpayers with simple returns could use Direct File. This excluded those with income from the gig economy or businesses, itemized deductions, and credits such as those related to child and dependent care or the savings credit. By 2025, eligibility will be expanded, allowing those claiming credits like the child and dependent care credit, the premium tax credit, the credit for the elderly and disabled, and credits for contributions to retirement savings accounts to use the program. Additionally, taxpayers with retirement income, 1099s for interest greater than $1,500, and deductions for health savings accounts will be included.
IRS Commissioner Danny Werfel stated that the primary goal is to improve the tax filing experience and make it easier for taxpayers to meet their obligations quickly and simply. According to a survey conducted by the IRS with over 15,000 participants, those who used Direct File this year mostly reported positive experiences, with 90% considering their experience excellent or above average. Many praised the simplicity, reliability, and cost-free nature of the software.
