19 million Americans will be able to file their taxes using the IRS’ new free online filing program, according to estimates released by the IRS over the weekend.
This estimate means that nearly 12% of all tax returns filed by individuals in 2022, totaling 160.6 million, could be processed online for free.
“For the first time in history, 19 million taxpayers in 12 states can now file their taxes online and directly with the IRS for free,” said Commissioner Danny Warfel. on video It was released on Saturday.
The IRS has previously said it expects hundreds of thousands of people to take advantage of the new online system, which is significantly lower than current eligibility estimates.
Although Americans overwhelmingly prefer to file their taxes online, the IRS still accepts paper returns, which regularly causes processing problems for the agency.
In 2022, 93.5 percent of personal returns were filed online, while only 6 percent were filed on paper and mailed.
Of those, 93.5 percent were filed online, 57 percent were filed using third-party preparation tools or tax preparation software, 2 percent were filed using the IRS’ old public-private “free file” system, and 41 percent were filed online. Submitted directly or through another electronic channel. According to IRS data.
The tax preparation industry has long viewed free online public tax filing options as a major threat to its business, with spending Multi-million dollar lobbying effort On the other hand. The IRS previously maintained non-compete clauses with some private companies.
The Direct File program was authorized in the Inflation Reduction Act of 2022 (IRA) and is currently being reviewed by the IRS. The bill increased the IRS’s budget by $80 billion over the next decade, but it has since been effectively reduced by about a quarter through annual spending cuts.
The funding has been a constant point of contention in a divided Congress and was quickly withdrawn by Republicans, who retake the House from Democrats in 2023.
The Direct File program is available in 12 states, including California, Texas, Florida, and New York.
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