New program: Floridians can file their taxes directly with the IRS for free; some are against it

The U.S. House on Wednesday, Jan. 31, 2024 voted to approve a tax package that would expand the current child tax credit for three years. (Photo of 1040 form by Getty Images)

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With the deadline to file federal tax returns less than a month away, two U.S. House members — Reps. Maxwell Frost and Darren Soto — made the pitch on Tuesday for Floridians to consider an IRS pilot program that would allow eligible Americans to file their taxes directly with the IRS at no cost.

The program is called Direct File, and Florida is one of 12 states chosen to participate in the initial pilot program. It stems from a provision of President Joe Biden’s 2022 Inflation Reduction Act (IRA) requiring that the IRS study the potential for taxpayers to have a free filing option. Government officials say the pilot program is limited for now and could be used by about 2.4 million Floridians this tax season.

However, the pilot program is opposed by a coalition of Republican attorneys general across the country.

On Jan. 30, Montana Attorney General Austin Knudsen and 12 other attorneys general sent a letter to U.S. Treasury Secretary Janet Yellen, saying that the IRS was never granted the authority to create the Direct File pilot program.

“We write to you in opposition to the unnecessary and unconstitutional efforts to empower the Internal Revenue Service (IRS) with the expansive authority to prepare and file tax returns for all taxpayers, the letter states. “Congress has never granted the Department of the Treasury authority to create a Direct File program. And for good reason: the American taxpayers do not want to invite the proverbial fox into the hen house. A Direct File program will also have negative consequences for low-income filers and devastate small businesses.”

Florida Attorney General Ashley Moody was not listed on the letter. Her office did not immediately respond for a request for comment.

According to the Department of Treasury, the Direct File pilot is an option for taxpayers who fall into these categories:

• Report income earned from jobs that generate a Form W-2; including taxpayers with more than one job with W-2 wages.

• Claim Earned Income Tax Credit, Child Tax Credit and the Credit for Other Dependents.

• Claim the standard deduction and deductions for educator expenses and student loan interest.

• Lived in the same state for the entire calendar year 2023.

Taxpayers can go to direct.file.irs.gov to determine if they’re eligible.

Neera Tanden, a domestic policy advisor for the White House, said that the program is “a big deal” for regular taxpayers.

“It is such a big deal because for years special interests have wanted to maintain the power to charge working people money for a very basic activity, which is filing their taxes, particularly when their taxes are relatively easy,” she said.

Florida Democratic U.S. Rep. Maxwell Frost appearing on a Zoom conference call on March 19, 2024 (photo credit: screenshot from conference call)

Orlando Democrat Frost encouraged Floridians on Tuesday to participate in the program, saying it would make a statement to those who opposed the full 2022 Inflation Reduction Act in Congress.

“We want to show our government and people who might disagree with this program, (meaning the IRA Act) people who voted against the IRA, that not only do we need this, but we’re going to use it and make sure that we have a high usership this year,” he said, adding that the goal is to make Direct File a nationwide program.

The Zoom press call on the issue took place on the same day in Florida as the presidential preference primary election, where only Republicans were going to the polls as the Florida Democratic Party opted to not have a competitive primary election by placing only President Biden’s name on the ballot.

U.S. Rep. Darren Soto via U.S. House.

“The average savings for Floridians will be about $270 and all this was made possible through the leadership of President Biden and House Democrats,” said Central Florida Democratic Congressman Darren Soto. “We’re excited that Florida made the cut and is one of 12 states that are going to get this.” 

The IRS Direct File pilot is also being introduced in California, Arizona, Massachusetts, Nevada, New Hampshire, New York, South Dakota, Tennessee, Texas, Washington and Wyoming.

Meanwhile, Florida Chief Financial Officer Jimmy Patronis has been a consistent critic of the IRS in recent years. Though his office did not return a request for comment regarding the Direct File program, Patronis spoke out again about the federal agency on March 8, the last day of the Florida legislative session.

“In 2022, the federal government went too far in targeting taxpayers by expanding the IRS. That’s why we worked with the legislature this year to create the Florida Tax Advocate to give Floridians a fighter in their corner when the IRS comes knocking,” he said in a statement.  “We won’t let Florida’s families and businesses be shaken down to fund Washington’s spending problems … We are putting Washington on notice that the State of Florida is watching, and we will fight for our taxpayers.”

He added:  “A top priority of CFO Patronis has been Fighting Back Against the IRS and protecting Florida taxpayers from targeting by the tax agency. The legislation will create the Florida Tax Advocate within the CFO’s office to give Florida taxpayers a seat at the table when IRS issues arise.”

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