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In a win for the paid tax prep industry, it looks like the government’s free tax filing program, Direct File, is dead for now.
The IRS emailed state tax agencies to notify them that "IRS Direct File will not be available in Filing Season 2026," according to NextGov/FCW, and “no launch date has been set for the future.”
The email isn’t a total surprise. In July, then-IRS Commissioner Bill Long—who Trump later fired—also indicated that the Direct File program had been scuttled. "You’ve heard of Direct File, that’s gone," Long said at the National Association of Enrolled Agents Tax Summit. "Big beautiful Billy wiped that out. I don’t care about Direct File. I care about direct audit."
Long was referring to Trump's Big Beautiful Bill, which allocated $15 million for a Treasury Department task force that would investigate a Direct File replacement, including potential public-private partnerships. That was due 90 days after the bill's July 4 enactment, or Oct. 2.
The Direct File program was well-received among users, according to the IRS. Last year, over 140,000 people used it in a pilot program that covered 12 US states, saving them an estimated $5.6 million in tax preparation fees.
This year, the Direct File program expanded to 25 US states, with over 296,000 people submitting a tax return through the service, according to NextGov. But now it looks like consumers will need to use paid tax software for next year’s tax season, although some free options still exist.
The IRS didn’t immediately respond to a request for comment.
Oregon's Department of Revenue confirmed it received the IRS email but would "continue to offer Direct File Oregon as a free electronic filing option for state income tax returns in 2026."
"Nearly 14,000 Oregon taxpayers filed their state returns with Direct File Oregon this year including 4,700 filers who connected to Direct File Oregon after first filing their federal returns through IRS Direct File," the department added. "Direct File Oregon can be used in combination with commercial software, a variety of income-based free software programs, and Free Fillable Forms, which is available to every taxpayer regardless of their income level."
Back in March, the Department of Government Efficiency under Elon Musk axed a technology unit that helped develop the IRS Direct File program.