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The IRS is showing their commitment to making free tax filing more accessible to everyone. 

At the end of May, the IRS and Department of Treasury announced that Direct File will become permanent and expand to all 50 states and DC for filing season 2025. They also indicated they will be looking into ways to further expand eligibility, as the pilot year only allowed for very specific tax use cases. This news came shortly after announcing they will extend the Free File Program, a free private-sector tax software, through 2029. 

At United Ways of California, we are thrilled to see more free filing resources and these IRS investments into free filing options for taxpayers. We fervently believe that tax filing should be free and accessible. People shouldn’t have to spend their hard-earned money toward paid preparers when there are trusted free filing options right at their fingertips. 

The IRS investment in Direct File will support more people in filing their taxes for free. California participated in the IRS Direct File pilot during the 2024 tax season, which went extremely well and generated lots of complimentary feedback. Taxpayers even called it “the most convenient way they’ve ever filed taxes.” You can view the pilot after action report here. 

However, for such expansions to be truly successful, California’s free filing tax software, CalFile, must integrate with Direct File. This integration will help streamline the free filing process and ensure that taxpayers can file their taxes quickly and accurately.

States that provided a streamlined filing experience for filers this year, like New York and Arizona, saw high satisfaction rates and state return completion rates. Nine out of 10 of federal Direct File users in those states went on to complete their pre-filled state return via the state integration—and 88% did so in 15 minutes or less. 

Other states found ways to integrate their state tax filing programs with Direct File, and California should do the same.

California Legislators, support the CalFile-Direct File integration for the upcoming tax season to ensure your constituents have efficient, seamless access to file their taxes for free and keep their hard-earned money in their pockets. 

What Direct File Means for VITA

We also believe IRS Direct File will work well alongside—not in lieu of—VITA (Volunteer Income Tax Assistance). With Direct File supporting California filers who have simpler returns or an easier filing process, VITA can continue to provide free tax help to those who have the highest need, supporting even more people in this group. For example, people with disabilities, people with language barriers, people with more complex returns, people applying for or renewing an ITIN, or other people who may face barriers or need to file in person will continue to benefit from direct support services like VITA.

With about 1 in 3 Californians not making enough money to meet basic needs, funding for programs like VITA and year-round tax outreach and education remains more critical than ever. 

At United Ways of California, we will continue to support programs like VITA to provide free tax help for those who need it most as well as support policies and tools that allow all Californians to file their taxes for free.

Learn about how you and members of your community can file taxes for free at MyFreeTaxes.org.