29 House Republicans Urge Trump to Terminate IRS Direct File with ‘Day-One Executive Order’

December 14, 2024 TruthUSA

The service is scheduled to expand to 24 states beginning with the 2025 filing season.

A coalition of Republican legislators is urging President-elect Donald Trump to terminate the U.S. Internal Revenue Service’s (IRS) Direct File, a free online tax filing tool, as soon as he takes office again.

Direct File operated as a pilot program during the 2024 filing season, with over 140,000 taxpayers utilizing the service across 12 states. In May, the IRS confirmed that it would become a permanent feature for filing federal returns starting in the 2025 tax season.

In a letter sent to Trump on Tuesday, 29 House Republicans requested him to take “immediate action, including but not limited to a day-one executive order,” to abolish the Direct File initiative, which they labeled as wasteful and a threat to American liberties.

“The establishment and continuous expansion of the program jeopardize taxpayers’ freedom from government overreach,” they asserted.

Direct File enables users to file taxes directly through the IRS, rather than through a trusted tax preparer. Consequently, the agency “positions itself as the tax assessor, collector, preparer, and enforcer—all at once.”

The lawmakers expressed concern over this arrangement, calling it “deeply troubling and a clear conflict of interest.” They emphasized that the tax agency lacks motivation to ensure that Americans utilizing Direct File are not overpaying their taxes.

Republicans claimed that the Direct File program is part of a broader strategy to monitor the financial activities of American citizens and target those who express opposition to the administration.

“The IRS has a history of misusing its power to intimidate political adversaries, even before the Biden-Harris administration. How can we trust the IRS to competently manage tax preparation and enforcement when it continuously violates Americans’ personal freedoms?” the legislators wrote.

When the expansion of Direct File was announced in May, the Treasury Department stated that the service is a key element of the administration’s objective to provide “modern, world-class customer service” for taxpayers, using resources secured through the Inflation Reduction Act.

Secretary of the Treasury Janet Yellen indicated that President Joe Biden is “dedicated to saving Americans time and money and ensuring families receive the tax benefits they deserve,” claiming that Direct File is vital to achieving these objectives.

The department noted that during the pilot phase, Direct File reportedly saved users approximately $5.6 million in filing costs while enabling them to claim over $90 million in refunds.

The letter from House Republicans mentioned that the IRS allocated $114 million for Direct File in 2024. Given that around 140,000 taxpayers used the service, the cost per return amounts to $814, which lawmakers argued is “not an efficient allocation of government resources.”

They contended that the private sector already provides “superior tax preparation services at no cost to the federal government,” suggesting that the IRS should instead focus on promoting these existing free alternatives using a small fraction of the budget spent on Direct File.

“Such efforts would yield better results for all taxpayers,” the lawmakers asserted.

Earlier this year, Representatives Adrian Smith (R-Neb.) and Chuck Edwards (R-N.C.), both signers of the letter, introduced legislation aimed at terminating the Direct File program.

The Epoch Times contacted the IRS for a response regarding the GOP’s letter.

In October, the IRS announced that Direct File will be available to eligible taxpayers in 24 states—double the number from the pilot phase—beginning with the upcoming filing season.

During the pilot phase, Direct File was accessible in the following states: Arizona, California, Florida, Massachusetts, Nevada, New Hampshire, New York, South Dakota, Tennessee, Texas, Washington State, and Wyoming.

For the 2025 season, the service will also be available in Alaska, Connecticut, Idaho, Kansas, Maine, Maryland, New Jersey, New Mexico, North Carolina, Oregon, Pennsylvania, and Wisconsin.

The agency anticipates that over 30 million taxpayers in these 24 states will be eligible to utilize Direct File next year.

“Direct File is a significant part of a stronger, more holistic tax system that provides taxpayers with electronic filing options suited to their requirements,” stated IRS Commissioner Danny Werfel.

“It is an essential instrument in the IRS’s mission to engage with taxpayers in a manner that suits their needs, offering them options to interact with us efficiently, and assisting them in fulfilling their tax obligations with ease and speed.”

The letter was also addressed to Elon Musk and Vivek Ramaswamy, both of whom Trump has appointed to lead the new Department of Government Efficiency (DOGE).

DOGE, an extra-governmental entity, aims to minimize unnecessary federal spending and reorganize government agencies. In mid-November, DOGE underscored the complexities of the U.S. tax code, asserting that “this must be simplified.”

Musk conducted a poll on his social media platform X in late November asking whether the IRS’s budget should be reduced, maintained, increased, or eliminated entirely. More than 60 percent of respondents indicated they favored the elimination of the IRS budget.

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