IRS Suspends Direct File Program, Pushes Taxpayers Toward Private Sector Alternatives
The IRS has abruptly halted its Direct File program, a free tax preparation tool available in 25 states, for the upcoming filing season. Treasury Secretary Scott Bessent, doubling as interim IRS commissioner, defended the MOVE by asserting private sector solutions offer "better alternatives." The decision follows a congressional mandate to evaluate costs and expand the Free File program—a privately operated service for taxpayers earning under $84,000 annually, which saw minimal adoption last season despite broad eligibility.
Republican critics have long targeted Direct File as wasteful, with its $41 million operational cost now under scrutiny. The suspension leaves a gap for thousands of users who relied on the government’s streamlined platform, redirecting them toward commercial options amid broader debates about public versus private service delivery.
