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Making State Tax Filing Easy with FileYourStateTaxes

Last year, the Internal Revenue Service (IRS) launched a pilot of a free, public, online tax filing tool. As Direct File now grows into its first full year, we are witnessing a transformative moment for tax filing access, especially given the significant pre-population functionality available in this year’s product.
Because tax filing in the United States is a federalist system, state filing was always going to be a central challenge of any federal Direct File product. Direct File proposed a novel approach as a solution: two tools that together would allow taxpayers to file both federal and state returns in one seamless process. In 2024, we and our partners in Arizona and New York were thrilled to help build this proposal’s success.
Now, less than a year after the end of its pilot phase, Direct File is available in half of states and is on track to reach all 50 in the years to come. This achievement is the product of many civil servants, advocates, and technology partners who worked tirelessly to bring this valuable service to clients in their states with remarkable speed.
FileYourStateTaxes helping Direct File reach half of states
Last year, just three states with income tax built solutions to seamlessly integrate with Direct File (Massachusetts and our two partners, Arizona and New York ). During the 2024 pilot, 90% of Direct File taxpayers in Arizona and New York filed accepted returns with FileYourStateTaxes, our user-friendly, plain-language, bilingual, and mobile-first state tax filing tool. In 2025, we hope that number will be even higher. This year, nine new states are launching integrated solutions—and we know from speaking with states over the last year that many more are excited to go next.
At Code for America, we’re partnering with four of the nine new states launching free, public e-filing of state taxes—Idaho, Maryland, New Jersey, and North Carolina—and continuing our support for Arizona. Since last week, Direct File taxpayers in these states have been able to use FileYourStateTaxes, importing their federal data and answering just a few short questions to complete their state returns.
Filing a state return with FileYourStateTaxes often takes just five minutes. Watch the demos of the process in Arizona, Idaho, Maryland, New Jersey, and North Carolina.
We’ve designed every facet of FileYourStateTaxes to be as lightweight and user-friendly as possible, to ensure as many people as possible are able to complete their state returns. Last year, a taxpayer who used FileYourStateTaxes told us, “It felt like what filing state taxes should be like. Theyʼre just a little add-on on top of the federal stuff.” This feedback epitomizes our objective: to make state tax filing so easy and quick that it’s barely memorable. Creating a seamless filing experience for taxpayers is most efficiently achieved by having clients start with their federal return, then leveraging that data for the state return.
Leveraging automation to improve the client experience
We use imported data from Direct File to automate taxpayers’ state returns as much as possible. Rather than showing taxpayers screens of their name, address, income, and household, pre-populated with data from their federal return, FileYourStateTaxes skips those screens entirely, showing full details only upon the taxpayer’s request. As a result, even in a state like Maryland, with over a dozen supported credits, deductions, and subtractions, many taxpayers answer only three or four pages of state-related questions to complete their returns. This year, we’ve used enhanced data-sharing functionality from Direct File to automate even more of the process.
We’ve applied the same logic to account creation. Creating an account can be a major point of friction for any online product, especially government products. Rather than make users repeat a rigorous account creation and verification process, FileYourStateTaxes allows taxpayers to create their accounts simply by confirming their email address or phone number. The verification comes from the taxpayer’s data import from their ID.me-verified Direct File account. This process is both secure and reliable for tax agencies and simple and quick for taxpayers.
Creating a seamless filing experience for taxpayers is most efficiently achieved by having clients start with their federal return, then leveraging that data for the state return.
A new, sustainable partnership model
Our goal with FileYourStateTaxes has always aligned with the goal of all our work at Code for America: empowering government to better serve people. FileYourStateTaxes has allowed all of our partner states to accelerate their participation in Direct File, but the nature of that collaboration varies from state to state.
In New Jersey, we are very proud to be launching FileYourStateTaxes thanks to a novel partnership with the Office of Innovation (OOI), a digital service team in the state government. Over the last four months, OOI product managers, designers, researchers, and engineers designed and built New Jersey-specific functionality onto the FileYourStateTaxes platform, allowing state government to take full ownership of state-specific components while reusing our product’s infrastructure, rather than starting from scratch. This collaboration allows us to reach even more taxpayers this year. It also offers a new model for how outside actors can work together with government to improve taxpayer service, and demonstrates how a centralized platform can make it easier for new states to join Direct File.
We’re also very excited that our partners in the New York State Department of Taxation and Finance launched their own government-run state filing solution last week for New Yorkers using Direct File. We partnered with New York during the Direct File pilot year to help accelerate the project and develop best practices collaboratively. Since the close of last tax season, New York has been building on the lessons of 2024 to craft a permanent solution in-house at the tax department—work that went live to taxpayers last week.
Our goal with FileYourStateTaxes has always aligned with the goal of all our work at Code for America: empowering government to better serve people.
Building momentum
Beyond the six states we’ve worked with, tax departments nationwide—in big states and small states, red states and blue states, low-tax states and high-tax states—are excited to offer Direct File to their taxpayers. In fact, for the dozens of states that have already provided state-level public filing tools for years, IRS Direct File isn’t a new proposition; it’s a commonsense solution they’ve long been wanting. Most of the 25 states that were unable to get a new solution into production by January 2025 are looking forward to joining in the years to come.
Alongside our allies across the country, we look forward to continuing to support the champions within state governments who are working to ensure Direct File quickly reaches every state—providing the simple, free tax preparation support all Americans deserve.