The Biden administration has announced a key change to the tax filing process for 1.5 million Americans. For the first time, more than 1.5 million Pennsylvanians will be able to file directly for free online, Treasury Secretary Janet Yellen announced on social media platform X Tuesday. The option will be available only to those with simple state and federal tax returns in January, but the tool might become available for those in other states and for different types of returns in the future. "It should be easy to meet your tax obligations and claim the credits, deductions, and refunds for which you are eligible. Instead, @IRSNews has been underfunded, which means that taxpayers have not gotten the support they deserve," Yellen wrote on X. "Thanks to the Biden-Harris Administration's Inflation Reduction Act, we're giving taxpayers better service in-person, over the phone, and online. We want it to be easy for taxpayers to get it right the first time and get their refunds as quickly as possible." The direct file tool aims to save taxpayers time and money by allowing them a direct option for free taxes, instead of forcing taxpayers to pay for a third-party service. Those tax filing options often cost several hundreds of dollars, Yellen added. The Internal Revenue Service originally tested out its direct file pilot program this year, and Yellen said the service successfully processed more than 5,000 returns daily. A total of 140,000 had used Direct File, which saved them $5.6 million collectively in federal filing fees. The pilot launched the tool in 12 states: Arizona, California, Florida, Massachusetts, Nevada, New Hampshire, New York, South Dakota, Tennessee, Texas, Washington and Wyoming. The response among users was also strong, as 90 percent of survey respondents said the service was "excellent or above average." "This update is a major positive change for those in Pennsylvania filing simple tax returns," Alex Beene, a financial literacy instructor at the University of Tennessee at Martin, told Newsweek. "Now, state taxpayers will be able to file their returns online for free, marking a shift from past years. This process should make filing returns quicker, more efficient, and more cost-effective." The pilot program was launched using money from the 2022 Inflation Reduction Act, which allocated $80 billion to the IRS. Previously, the IRS Commissioner Daniel Werfel said the agency intended to "roll it out in increments that get larger and larger, consistent with how products like this are rolled out in the private sector." According to the U.S. Treasury Department, Americans spend more than $11 billion on tax prep services each year. That's an average of $270 and 13 hours lost to the process before the Direct File tool was available. "This is going to allow people ease of access to their government, showing them that there is no wrong door," Pennsylvania Governor Josh Shapiro said in a statement. "Saving them hundreds if not thousands of dollars on software or other services that maybe they really didn't need in the first place." ## The IRS’s Direct File: A Permanent Solution? The move follows a successful pilot program during the 2024 tax filing season in 12 states after which the IRS announced that it would offer a permanent free filing system. The program has been praised by many, including Yellen, who says it has “dramatically improved the taxpayer experience.” The program’s success is evidenced by the fact that it attracted filings from 140,000 taxpayers – exceeding the 100,000 goal – who claimed more than $90 million in refunds and saved an estimated $5.6 million in fees that would have been charged by private tax preparers. ## Republicans Remain Unconvinced However, the program has faced criticism from some, including Republicans who have vowed to rescind the $60 billion in new modernization funding for the IRS over a decade that funded the pilot program. Republicans are also concerned about the program’s potential impact on state tax revenues. ## What’s Next for Pennsylvania Taxpayers? Pennsylvania’s decision to join the IRS’s free direct filing system is a major victory for taxpayers in the state. This is a major positive change for those in Pennsylvania filing simple tax returns. It should make filing returns quicker, more efficient, and more cost-effective, providing taxpayers with a simple way to file their taxes and claim the credits, deductions, and refunds for which they are eligible. ## A Bright Future for Tax Filing? Despite the criticisms, the IRS’s free direct filing system is a welcome development for taxpayers across the country. It will help to ensure that everyone has access to a simple and affordable way to file their taxes. The program’s success is a testament to the fact that taxpayers want and deserve easy access to their government. It is a step in the right direction towards a more equitable and efficient tax system.