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IRS to open its free tax filing site to more new users – ABC News

As tax filing season begins, taxpayers in some states will have a new way to file online “within days,” the IRS announced this week.

direct fileA free site for filing federal tax returns directly through the IRS opens for new users. 12 states The IRS said it was provided for an unspecified period of time before becoming widely available to taxpayers in those states in mid-March.

The IRS has already launched a testing site for some federal employees.

The IRS says the pilot program seeks to offer taxpayers a free alternative to using government websites to file online returns instead of paying for-profit companies to do so. There is.

According to the IRS, the website explains tax concepts and has customer support agents available to answer basic tax law questions in English and Spanish via chat.

The agency created the platform with funding from the 10-year Inflation Control Act of 2022, which includes $80 billion to improve the IRS.

Here we explain how Direct File works and how taxpayers can use it.

Who is eligible?

Direct File will be available to taxpayers who resided in 12 states in 2023: Arizona, California, Florida, Massachusetts, Nevada, New Hampshire, New York, South Dakota, Tennessee, Texas, Washington, and Wyoming.

Additionally, taxpayers in these states must qualify based on the type and amount of their income. For example, taxpayers and independent contractors whose wages exceed $200,000 will no longer be able to use this site. Use of the platform may also be limited depending on the type of health insurance purchased by the taxpayer.

When will it be available to taxpayers?

The platform will be available to taxpayers in those 12 states within the next few days, the IRS said in a news release.

There is no specific date or time when Direct File will be rolled out to new users in these 12 states, but it will be rolled out “within a short period of time without notice.” The platform status is displayed at the top. Website. The IRS says the platform will be widely available to the public in mid-March.

The IRS says this is part of a testing phase to see how the site performs with a larger number of users.

Nina E. Olson, executive director of the nonprofit Center for Taxpayer Rights, said officials will start with the smallest groups of tests and the simplest features. That’s how the private sector platform started, she said.

What taxes is this site used for?

Direct File can only be used for federal taxes. State taxes must be filed separately through a separate platform. However, this site will direct taxpayers residing in Arizona, California, Massachusetts, or New York to a state-supported platform to transfer information for filing state returns. According to , these states were chosen because they chose to partner with government agencies. IRS website.

How to use it?

Because Direct File is a website, taxpayers do not need to install any special software or applications.

First, taxpayers must sign up for ID.me, the IRS’ identity verification tool, which users claim has problems.

According to an ID.me spokesperson, 88% of first-time users across the federal government have no wait time to authenticate.

“For the vast majority of users, the wait time to authenticate through the service is very short, if any at all,” the spokesperson said.

Olson said the ID.me issue is a government-wide issue and not specific to the IRS. The testing phase should also help identify the reasons why some taxpayers are rejected when they try to register, so they can be addressed later, he said.

If a taxpayer misses a window when Direct File is open, they can still sign up for ID.me and check the site for the next window.

The IRS says the site includes a step-by-step guide on how to track the progress of your return. Once a taxpayer has started filing, they can return to the platform at any time during the season to continue filing, even if the site is closed to new users.

Direct files for government agencies are optional. Other paid and free alternatives remain available to taxpayers.

Olson said a similar site should have been created decades ago, but this is a move in the right direction.

Editor’s note: This article has been updated with comment from an ID.me spokesperson.

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