IRS pleased with initial use of free filing option

WASHINGTON — The IRS said Friday that more than 140,000 taxpayers filed their taxes through its new direct file pilot program and participants saved $5.6 million in fees they would have otherwise spent with commercial tax preparation companies.

The program, rolled out this tax season in 12 states, allows people with simple W-2s to calculate and submit their returns to the IRS for free. Those using the program claimed more than $90 million in refunds, the IRS said. But despite what IRS and Treasury Department officials said was a successful rollout, they aren’t saying whether the program will be available next year for more taxpayers.

“We will take time to analyze the data and collect feedback from a wide variety of stakeholders before making a decision about direct file’s future,” IRS Commissioner Daniel Werfel said.

The program, which went public March 8, cost about $10.5 million for technology and product development, plus $2.4 million for customer service, cloud computing and user authentication.

While the Treasury set a goal of reaching 100,000 users for the pilot, 140,803 completed their taxes using the program. More than 3 million people used the IRS’s eligibility tracker to see whether they could use the program, and 423,450 people logged in to the program.

The program was available to certain taxpayers in Florida, New Hampshire, Nevada, South Dakota, Tennessee, Texas, Washington and Wyoming. Four other states with a state income tax also were part of the program — Arizona, California, Massachusetts and New York. In those four, tax agencies helped people file their state taxes.