Tax Season 2024: IRS Plans Free Filing Program in 13 States — Is Yours One of Them?
With tax season officially starting on January 29, eligible taxpayers will be able to file their returns online directly with the IRS for free without using a private provider, if you live in a participating state.
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As part of its effort to provide U.S. residents with a free tax-filing service, the IRS has partnered with 13 states as part of its Direct File pilot program for 2024. According to CNN, “several hundred thousand taxpayers” are expected to use the pilot program this year.
Although all states were invited to join in the pilot, many declined to participate at this time but have expressed interest in the future. However, taxpayers in four participating states — Arizona, California, Massachusetts and New York — will be able to start using Direct File in 2024 to file their federal and state taxes.
Residents living in nine states that don’t have state income taxes — Alaska, Florida, New Hampshire, Nevada, South Dakota, Tennessee, Texas, Washington and Wyoming — will be eligible to use Direct File for their federal taxes (Washington has joined as a partner for the state’s application of the Working Families Tax Credit).
Who Is Eligible to Use Direct File?
According to the IRS, the pilot program will open in successive phases, will be limited to certain eligible taxpayers at first and will gradually be available to more taxpayers as the tax filing season goes on.
“In this limited pilot for 2024, we’ll be working closely with the states that have agreed to participate in an important test run of the state integration,” said IRS Commissioner Danny Werfel. “This will help us gather important information about the future direction of the Direct File program.”
The pilot will be accessible to taxpayers filing relatively simple returns and reporting only certain types of income, credit and deductions. The IRS says it expects taxpayers to be able to file returns containing the following tax information:
Income reporting: W-2 wage income, Social Security and railroad retirement income, unemployment compensation and interest of $1,500 or less;
Credits: Earned Income Tax Credit, Child Tax Credit, Credit for Other Dependents;
Deductions: Standard deduction, student loan interest, educator expenses.
While not specifically intended to replace the Free File Program that has been available through third-party companies the past several years, Direct File is an attempt to improve taxpayer services using funding provided by the Inflation Reduction Act.
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Direct File will be offered in English and Spanish to start and can be used on a mobile-friendly phone, tablet or computer, requiring no software to buy or install.
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This article originally appeared on GOBankingRates.com: Tax Season 2024: IRS Plans Free Filing Program in 13 States — Is Yours One of Them?
