The IRS’s complimentary Direct File initiative, which enabled taxpayers to finalize their taxes using free, guided tax software endorsed by the federal body, has been terminated following the Trump administration’s choice to abolish the service as part of his One Big Beautiful Bill.
The expected decision was seemingly validated earlier this week when IRS Commissioner Billy Long informed participants at the National Association of Enrolled Agents Tax Summit that the program was “gone.”
Long expressed that the agency’s renewed emphasis is on advanced “audit tech,” stating: “You’ve heard of Direct File, that’s gone. Big beautiful Billy wiped that out. I don’t care about Direct File. I care about direct audit.” An internal IRS report revealed that over 300,000 Americans utilized the service in 2025.
The agency’s Free File preparation service was introduced for the 2025 tax season after a testing phase in 2024, prompted by demands from political figures and advocates. In the wake of Long’s remarks, Sen. Elizabeth Warren and others accused the Trump administration of aligning with large tax preparation firms, such as H&R Block and TurboTax parent Intuit, prioritizing their interests over those of the American public. “Direct File was an uncomplicated method for Americans to file their taxes for FREE each year. It’s a no-brainer — and it’s popular. So why in the world did the Trump administration eliminate it? To provide a massive handout to enormous tax prep companies like TurboTax that exploit Americans,” she posted on X on July 29.
The IRS has not yet verified the discontinuation of Free File but hinted at possible private collaborations to succeed the preparation service. “Commissioner Billy Long is dedicated to modernizing the IRS and delivering a taxpayer experience that meets contemporary expectations, which includes granting taxpayers clarity regarding the status of their tax returns and audits,” an IRS spokesperson informed CNBC. “We look forward to Treasury’s upcoming report to Congress on the Direct File program and on potential public-private partnership alternatives to Direct File, as mandated by the One Big Beautiful Bill.”