Trendpills
The Internal Revenue Service (IRS) has confirmed that its free, government-run tax filing platform, Direct File, will not be operational for the 2026 tax season. The decision effectively halts a pilot program that offered a no-cost alternative to commercial tax preparation software for millions of taxpayers.
In early November 2025, the agency informed state officials via email that the service would not be offered in 2026, signaling a major policy reversal. The move comes after the new Trump administration and Republican lawmakers expressed strong opposition to the federally managed system, arguing it was an unnecessary government overreach and a waste of resources.
Direct File was first launched as a limited pilot in 2024, available to taxpayers with relatively simple returns across 12 states. According to Treasury Department data, the pilot was well-received, with over 140,000 people successfully filing their taxes and 90% of surveyed users rating their experience positively. Proponents had hoped to make the program permanent and expand its availability nationwide, citing its potential to save taxpayers billions in filing fees.
The initiative was consistently opposed by powerful commercial tax preparation firms like Intuit (the maker of TurboTax) and H&R Block, which have a vested interest in maintaining the market for paid tax software. These companies have historically lobbied against the creation of a government-run filing system, framing it as direct competition.
With the program's discontinuation, taxpayers must once again turn to existing options. These include the IRS Free File program—a partnership with commercial companies for filers below an income threshold—or paid software. For the foreseeable future, taxpayers with simple financial situations will no longer have access to this government-run tool, marking a significant victory for the private tax preparation industry.
