Code for America strongly supports the IRS’s Direct File scaled pilot because it will provide a vital new option for families in America to file their taxes for free, directly with the government, for the first time. That’s why we’ve joined with more than 200 other organizations in expressing our support for this groundbreaking program and are an active member of the Coalition for Free and Fair Filing.
One of the identified challenges with Direct File is ensuring that taxpayers can file their tax returns with the federal government and states at the same time. The IRS’s May announcement of the Direct File pilot highlighted this issue and made it clear it was a priority to address. And as Commissioner Werfel’s letter last week documented, the IRS has communicated with states and organizations throughout the tax space in the past months on the importance of the state filing issue.
In light of this, Code for America is currently exploring what it would take to develop state tax software that would create a seamless filing experience for filers. Requesting a vendor ID with the National Association of Computerized Tax Preparers (NACTP) is a preliminary step in this exploratory effort. We, like many others in the space, have had numerous discussions regarding state tax filing both inside and outside of government, though we have no partnership with the IRS on Direct File.
Our work in this area is part of our mission and longstanding efforts to make government services more accessible for the people who use them. This includes working in Utah to automatically clear low-level criminal records, in Louisiana to remind people via text to sign up for benefits, and in multiple states to dramatically reduce the time it takes to apply for food assistance from more than an hour to just 10 minutes.
On Direct File, we remain optimistic that the pilot will be a success. Americans deserve a free option to file their taxes directly with the government at both the federal and state levels.