Sen. Elizabeth Warren (D-Mass.) Criticized the Lobby of Intuit against Direct File and told the AP that Trump and Musk 'go after a direct file because it prevents gigantic tax preparation companies from curing taxpayers for services that must be free. Americans want a free and easy way to submit their taxes and Musk want to remove that. '
Intuit's TurboTax offers free submission for simple returns, but has confronted with lawsuits who claim that his advertisements have misled consumers who had to pay. In 2022, Intuit agreed to pay $ 141 million in refunds to millions of consumers and to stop a specific advertising campaign that promised free submission.
The Federal Trade Commission ruled last year that Intuit Intuit violated American law with misleading advertisements and ordered the company to stop telling consumers that TurboTax is free without clearer disclaimers. Intuit responded by the FTC responding in a case that is still pending at the US Court of Appeals for the 5th circuit.
The free IRS archiving program is also limited to simple returns, but there was hope for expanding the usefulness. The program accepted declarations of 140,803 taxpayers in the 12-state 2024 pilot, which was followed by an announcement of May 2024 that direct file “would become a permanent option for submitting federal tax returns from the tax season 2025.”
In the 2024 announcement, the IRS said that it was looking for ways to cover more complicated tax returns. “In the coming years, the agency's goal is to expand the direct file to support the most common tax situations, with a certain focus on those situations that influence working families,” the IRS said at the time. The Ministry of Finance estimated that this year more than 30 million taxpayers were eligible for direct file, but has not yet said how many people have used it.
House republicans insisted Trump to act even faster to kill the program and say in a letter from December 2024 that he “should give a daily executive order to put an end to the unauthorized and wasteful direct file pilot program of the Internal Revenue Service (IRS).”
