Sarasota congressman Steube cosponsors bill to outlaw IRS direct tax filing program
SARASOTA HERALD TRIBUNE —A burgeoning Internal Revenue Service program that would allow Americans to file their taxes directly with the federal government has come against opposition from congressional Republicans, including Sarasota Rep. Greg Steube.
Steube co-sponsored the “IRS Overreach Prevention Act,” introduced by Reps. Adrian Smith, R-Neb., and Chuck Edwards, R-North Carolina, in July. The bill is meant to “prohibit the Secretary of the Treasury from implementing or continuing a free, public electronic tax return-filing service option.”
Its language barely stretches to two pages:
“The Secretary of the Treasury (or the Secretary’s delegate) may not continue the Direct File program of the Internal Revenue Service, and may not develop or provide to taxpayers any successor program which provides a free, public electronic return-filing service option.”
The legislation targets IRS Direct File, which began in 2024 as a pilot program that will be expanded in 2025. More than 140,000 taxpayers across a dozen states – including Florida – used the pilot program in the past tax season. The agency said those users saved about $5.6 million in tax preparation fees.
The federally-run filing system was designed as cost-free alternative to services such as TurboTax and H&R Block. The average individual taxpayer spends about 8 hours and $140 preparing their taxes, according to a 2023 IRS Report to Congress. A 2024 poll commissioned by the Groundwork Collaborative, a progressive nonprofit, found that 95% of Floridians wanted free tax filing service from the IRS.
After the pilot ended, all 50 states and Washington, D.C. were invited to join the permanent program. However, some GOP representatives are determined to kill Direct File. In a statement to the Herald-Tribune, Steube criticized the program as unnecessary and said it lacked congressional authorization.
“Americans do not want the IRS as their accountant. It’s big government overreach for the IRS to do Americans’ taxes for them, while also acting as the collector and auditor,” Steube said. “A government-run tax prep system is a bad idea and a massive conflict of interest for an agency that is already weaponized against hard-working Americans.”
The congressman also said that the IRS is unequipped to handle such a program, which would be better served by the private sector.
In a July press release, Adrian Smith called the program a scheme by the Biden Administration to with the goal of “comprehensive monitoring over the personal finances of Americans.”
“The last thing American taxpayers need is an IRS with expanded ability to predetermine what tax they owe and burden them with audits,” Smith said. “This bill directs IRS to drop the program, which lacks both measurable success and statutory authority, and focus on better serving hard-working Americans.”
House Ways and Means Chair Jason Smith, R-Missouri, has been steadfastly opposed to the Direct File program. Rep. Vern Buchanan, R-Longboat Key, sits on the House Ways and Means Committee with Steube and Smith but has yet to indicate support for the bill. His office did not provide comment in time for publication.
Twelve Republican state attorneys general called on Treasury Secretary Janet Yellen to end the Direct File program, which they said was “unnecessary and unconstitutional.” Florida Attorney General Ashley Moody was not included; as there is no state income tax in Florida, it did not have to voluntarily opt-in to the pilot program for residents to use it.
The IRS did not provide comment to the Herald-Tribune in time for publication. Haris Talwar, a spokesperson for the U.S. Treasury Department, said in a statement that the Direct File program would save its users time and money.
“This is an option that American taxpayers want and many other countries have offered for years,” Talwar said. “This common sense tool will benefit Americans who are frustrated with having to spend hours and pay hundreds of dollars and hidden fees to private companies to file their taxes.”
A progressive economic non-profit called the Economic Security Project found in a 2024 report that after five years at full service, Direct File would annually save the average user about $160 in filing fees.
“By breaking down barriers to filing, Direct File would also deliver up to $12 billion each year in additional tax credits to low-income families currently missing out,” the report said.
The Treasury Department said that in a survey of more than 11,000 Direct File users, 90% of respondents rated the user experience as “Excellent” or “Above Average.”
“A majority of survey respondents who filed taxes in the prior year reported having to pay to prepare their taxes last year,” the statement said. “Among survey respondents, 47% of users paid to file their taxes last year and 16% did not file last year at all.”
The bill may pose an existential threat to private tax-filing companies such as Intuit, H&R Block, and Jackson Hewitt. An alliance of tax preparation and software corporations called the American Coalition for Taxpayer Rights has vigorously opposed a free direct filing program. The ACTR has spent over $1 million on lobbying efforts since 2021.
