Direct File won't happen in 2026, IRS tells states

199 pointsposted 6 hours ago
by jhatax

99 Comments

jordanb

5 hours ago

grandpoobah

4 hours ago

Such a cheap bribe holy crap.

vjvjvjvjghv

4 hours ago

When you look at the donations politicians receive and the ROI they produce you quickly realize that they are way too cheap. Politicians should ask for way more money so lobbying is not that incredibly profitable.

latexr

4 hours ago

> Politicians should ask for way more money so lobbying is not that incredibly profitable.

Except those corrupt politicians want lobbying to be profitable, so they can profit from it too. And if they ask for too much, they’ll just bribe the next guy or may even try to put their own in office. Can’t have that!

gigatree

3 hours ago

Ah yes, the free market

c0balt

3 hours ago

Healthy competition, the free market has resolved the issues of overpriced bribes. /s

cbgb2

3 hours ago

Maybe lobbyists should be punished by having their skin fully tattooed blue like smurfs.

This way, you’d have to really be into lobbying to suffer the tattoo pain and permanent branding.

foxglacier

3 hours ago

Or voters should take some civic responsibility and stop voting for corrupt politicians. Americans seem to be either unable to make their own decisions without paid advertising to direct them or they're afraid of "wasting" their vote on candidates that didn't spend enough on advertising.

toolazytologin

an hour ago

Or “politics” are too much of their identity and they always vote for “their guy” regardless of the merits. Education does not matter when the vote has nothing to so with rationality and is only rooting for a team.

Corruption will never be solved. It could possibly be reduced if there was less ROI. I expect that would require shrinking the government so there is less centralized power. A limited federal government and more administrative power handed back to the states (within reason) would be interesting.

mptest

2 hours ago

this is just a more abstract "bootstraps" argument. schooling in this country has been systematically attacked and deconstructed, and as the burger reich's leader says, "i love the poorly educated". this is not "dum timmy votes for dum thing" it's "countless $ and effort and man hours have been devoted to making the american populace dumber" Why? look at any polling breakdown for how the educated vote vs the uneducated.

whoooboyy

an hour ago

Try telling people you voted third party because of a deeply held conviction about not electing corrupt politicians. You will be told you are evil, that you've got an unreasonable/impossible purity bar, that you don't really believe in that deeply held moral conviction actually, that you are worse than the people who voted for the other guy, that you are a utopian idealist, etc etc.

Don't get me wrong, I did vote third party and I will continue to do so if the Dems put up candidates like Harris and Biden. But don't expect most people to be willing to weather the storm of vitriol they'll receive for holding a high bar for their politicians.

petralithic

an hour ago

It's more that voting third party in a first-past-the-post voting scheme is systemically pointless.

whoooboyy

29 minutes ago

Parent poster said to stop voting for bad candidates. I said you would be mocked/judged/told off for doing so. And here we are.

AnotherGoodName

3 hours ago

Meanwhile in pretty much all other nations you go online to the free website, see your employer contributions already filled in and acknowledge they are correct for the year, add any extra income, check boxes for relevant deductions and you’re done.

terminalshort

3 hours ago

Which is basically how it works here too. If you just have W-2 income from an employer it takes less than 10 minutes to fill out the form. Sure, the system you mention is more convenient, but the difference is minimal.

rcbdev

2 hours ago

The system he mentioned is usually equally simple for self-employed.

chneu

14 minutes ago

Lol not really in practice.

foxglacier

3 hours ago

Doesn't America have uniquely complicated tax that requires you to keep all your receipts to claim all sorts of confusing deductions? How can the IRS know what you spent your income on if you don't tell them?

I've had the misfortune of having to fill in a W8-BEN-E form [1] and the first time, I just gave up and refused to work with the client because it was too complicated. The 2nd time, I got an LLM to tell me how to fill it in. Just look at the dense jargon - nonparticipating FFI, deemed-compliant FFI, Restricted distributor, International organiztion (hint, that's the wrong answer), Excepted territory NFFE, Passive NFFE, Direct reporting NFFE. There are 32 of them! What the hell is all that? Well 99% of cases are just one of those buried among the rest but you wouldn't know which without some advice.

[1] https://www.irs.gov/pub/irs-pdf/fw8bene.pdf

thayne

2 hours ago

For most people, those deductions are less than the "standard" deduction you can take instead. For most of the people who do itemized deductions, it's mostly just your mortgage payment and state taxes, which the IRS already knows about, and maybe charitable donations.

And even if you do have a lot of things to report, why not just report those things directly and let the IRS calculate your taxes, rather than you having to do it, fill out a complicated form, then the IRS does the calculation anyways to make sure you did it right?

ptmcc

2 hours ago

The majority of Americans are W2 wage earners that take the standard deduction.

tietjens

2 hours ago

For a truly uniquely complicated tax system please move to Germany.

thesumofall

an hour ago

While I fully agree that there are a lot of complicated rules for edge cases, for simple (non self employed) cases it is very straightforward. In fact, you don’t have to do anything at all in many cases and still won’t be screwed over as the German IRS will assume typical deductions. There is an official free filing software and if you spend 20-30 USD a year you’ll get access to super easy to use professional filing software. My situation is more complicated than most and I spend 2hrs a year for my entire family

realusername

2 hours ago

I highly doubt that it's more complicated than the French or German tax system.

sofixa

39 minutes ago

Based on what?

The French tax system is pretty simple. Taxes are high, but simple. The website you use to file your taxes is also pretty simple, and every single field has a button that explains what it is about and in which cases you should write stuff inside.

The only annoying parts are if you have accounts outside of France, you have to declare them. And if you get dividends/capital gains in foreign currencies outside of the EU, you have to calculate yourself how much tax you owe using a bunch of tables per country and currency.

realusername

37 minutes ago

For basic taxes yes but you have annex forms which are 20 pages long in the french system.

sofixa

31 minutes ago

Yes, and? Nobody would fill all annexes. They are annexes because they're not part of the common path, and are only needed in specific scenarios. Their length is kind of irrelevant.

simoncion

2 hours ago

> Just look at the dense jargon ... There are 32 of them! What the hell is all that?

For every form I've ever had to file with the IRS, there's a corresponding set of instructions. Those instructions inevitably have a definitions section and/or define the terms in-line.

The instructions for form W8-BEN-E are at [0]. The definitions section starts at printed page 4 and continues through to printed page 7. Some terms you mentioned (like "Excepted territory NFFE") are not in the definitions section, but are described in their own sections.

I'm definitely not going to claim that it's foolish to consult with a tax lawyer (or similar such thing) when one is significantly uncertain about one's taxes. I'm definitely going to object to your implied claim that the IRS dumps a bunch of jargon on you and leaves you to rely on general-purpose search engines to figure out what the fuck they're talking about.

[0] <https://www.irs.gov/pub/irs-pdf/iw8bene.pdf>

jandrewrogers

2 hours ago

Remember, Americans have to file taxes separately to the State and Federal government. The Federal government has little authority to dictate State taxes. The paperwork is in part a coordination problem between the State and Federal governments.

Basic taxes are trivial in the US if you just work to live, it is essentially one page. However, there is an extremely long and fat tail where the government has no way of knowing the correct details to compute your taxes. There are myriad subsidies and offsets that have to be accounted for, many of which depend on what State you live in.

If you earn a lot of money, like the tech people that frequent this website, you are much more likely to find yourself in that fat tail. It can become esoteric quite quickly. The Federal tax code has to accommodate the completely independent tax codes of all 50 States in a reasonable way.

Jolter

2 hours ago

Even so, Direct File was possible.

Until it wasn’t.

RajT88

2 hours ago

It is not that complex. RSU's or options are pretty straightforward.

Deductions can get esoteric if you sold a bunch of stock. Even then, not that bad.

jandrewrogers

2 hours ago

Congratulations on having simple taxes. It can definitely get more complex.

There is a reason Americans spend staggering amounts of time and money on tax preparation. It is simple until it isn’t.

mulmen

37 minutes ago

Yes, the reason is Intuit.

pjc50

an hour ago

If they genuinely can't work out what you owe, why bother paying it at all? Shouldn't there be a massive tax evasion problem?

hyperrail

5 hours ago

https://github.com/IRS-Public/direct-file <- Direct File's web app source code is public-domain and published on GitHub!

Obviously the 2025 version will be out of date for the 2026 filing season, though public code means it can always be revived by anyone else.

(previous HN threads: https://news.ycombinator.com/item?id=44182356 https://news.ycombinator.com/item?id=44131901 )

thayne

3 hours ago

Does the "Modernized eFile API" still exist?

nikodunk

an hour ago

Fascinating repo, thank you for sharing!

MinimalAction

2 hours ago

I just looked up https://directfile.irs.gov/. While it says closed, the testimonies on this site speak to how easy the filing was. Almost feels like it is intentional to keep rest of the site as is with a small banner on top announcing the closure, as a way to hint at this stupid move by the administration.

agentbellnorm

an hour ago

Paying a private company so you can pay the government.

You guys need to raise your expectations.

miki123211

2 hours ago

Why won't a non-profit pick up the open-source code they released and modify it for 2026?

Everybody seems to care about this issue so much, so this feels like an extremely high-impact thing to do.

cozzyd

5 hours ago

As long as they don't kill FreeFillableForms...

mixmastamyk

3 hours ago

It started requiring phone numbers and things and I stopped using it in favor of my own spreadsheet.

simoncion

an hour ago

> It started requiring phone numbers and things...

a) You're already trusting them with every piece of information in your tax return. It'd cost like five cents to use that information to discover your phone number... if they're malicious, you're already fucked.

b) When? At the end of the process where you're doing stuff like attesting that you're not lied on your tax return? I don't remember them demanding a phone number up front, and I also don't remember whether or not I refused to provide a phone number at the end.

cozzyd

an hour ago

The 1040 has a spot for phone number too...

simoncion

an hour ago

The 1040 has a spot for both a phone number and an email address. The 1040 instructions make it completely clear that both are optional.

  You have the option of entering your
  phone number and email address in the
  spaces provided. There will be no effect
  on the processing of your return if you
  choose not to enter this information.
  Note that the IRS initiates most contacts
  through regular mail delivered by the
  United States Postal Service.

beej71

3 hours ago

If they do, I'm filing paper. Clowns.

jabroni_salad

3 hours ago

You know, the IRS is basically defunded, even not counting the whole shutdown thing. I wonder how many people need to file handwritten by mail before it becomes a significant problem

cyberax

2 hours ago

IRS will absolutely go after regular people who just have a W-2 and maybe a couple of 1040 forms. It's easy to verify automatically.

But if you're a rich person with dozens of companies and complicated trusts? Yep, nobody is going to be looking.

sydbarrett74

3 hours ago

Why innovate when you can be a perpetual rentier?

voidhorse

5 hours ago

Isn't it great to have a government that serves corporations and not its people!

croes

3 hours ago

But corporations are people

ksimukka

2 hours ago

Ok, fine, I’ll use TurboTax.

I live and work abroad and Turbotax requires a US billing address to pay the fee of using Turbotax. :facepalm

All the other self-service options do not work and I’m not sure if the risk is worth it to file it myself.

To my fellow Expats, what are you doing?

chneu

12 minutes ago

Does FreeTaxUSA work for you?

thayne

2 hours ago

If your tax situation isn't too complicated, it actually isn't too hard to fill out the forms yourself[1]. But if you are living abroad, unfortunately your tax situation probably isn't that simple.

[1]: Although I find it incredibly frustrating the lengths they go to to avoid negative numbers on the forms.

sublinear

4 hours ago

What was wrong with using Free File Fillable Forms in the first place? It's the real deal forms just online and with nothing obscured or sugar coated.

I use it every year, and while I wouldn't exactly say I enjoy doing my taxes, I do enjoy being fully aware what I'm filing and not being forced to do it on paper just because others have obtuse opinions or are lazy.

hshdhdhj4444

4 hours ago

Why does anyone want a better option when a worse option is available…

daemonologist

3 hours ago

I've used the fillable forms before; the problem is that to fill them out with confidence - to even know with confidence which ones you should be filling out - requires more knowledge of tax law than the average person can reasonably be expected to possess.

Now, the various self-filing software products also feel a lot like guessing, but at least they walk you through which guesses are mostly likely to be correct and can catch the most egregious errors.

dlcarrier

3 hours ago

The form that you fill out has a very tearse description of the field, but the actual instructions are in a separate document. For example, form 1040 is here: https://www.irs.gov/pub/irs-pdf/f1040.pdf and the instructions document is here: https://www.irs.gov/pub/irs-pdf/i1040gi.pdf

The instructions make it very clear when a field in the form should be used and what should go in it.

_vertigo

3 hours ago

Yes, obviously, everyone knows that. When all you have to file is a 1040, reading one of the instructions documents is fine. When you have to use several forms it start to add up.

anon291

23 minutes ago

I've filed my own taxes for years and have a complicated set up; real estate, stocks, rsus, espps, private shares, amt, etc ... It's extremely straightforward and takes less time than using turbotax if you've done it before. The instructions are obvious.

You can also call the IRS and be told for free what the rules are. People pay h&r block and Intuit when the irs is extremely responsive and will connect you with an actual American irs rep to answer your questions.

People pay for the software because they've been marketed to not because they need it. For the situations that are actually hard, then a software like TurboTax is useless.

Also if you get the numbers wrong the IRS just corrects it

simoncion

an hour ago

> Yes, obviously, everyone knows that.

It's pretty clear that daemonologist did not know that. Which is weird, given that all the tax law the average USian needs to know is "Read and follow the instructions for Form 1040.".

(RIP 1040-EZ. You were a good form.)

Also, I've had to file several forms in the past. It 'adds up', but it's all mechanically following instructions... not anything difficult.

terminalshort

3 hours ago

Unless you have a unreasonably complicated return, you need absolutely no knowledge of tax law. It's all just "take the number from box X on form A and write it in box Y of form B."

thayne

2 hours ago

Yes. I've used Free filllable forms several times. For basic tax situations, and even mildly complex ones, the problem isn't so much that it is hard as that it is very tedious.

It involves reading a lot of instructions, with many references to other documents and other sections. It involves copying a lot of numbers from one place to another, and doing basic math on them to get a new one.

It could be improved a lot just by automatically calculating more fields, and adding more of the "worksheets" that are in the instructions into the forms so it can calculate those for you.

cozzyd

2 hours ago

yes, the worksheets especially are tedious when they could be automatically calculate with relatively little effort in most cases.

delfugal

4 hours ago

Only in America would citizens allow some CEO run company, like Intuit to rob them blind year after year. Americans are dumb.

chneu

10 minutes ago

Not only are Americans dumb, they're incredibly ego driven and stubborn. That means Americans always think they're right. Everyone else is doing it wrong.

You can always count on Americans to do the right thing after they've tried everything else.

I'm American. If you don't buy into the insane status-symbol ego culture, it's daily insanity of excess consumption and selfishness.

The worst part is no one wants to hear this. There's a crazy culture of "Saying anything is mean". We shove our heads in the dirt all the time.

terminalshort

3 hours ago

Yeah, it's incredibly dumb to pay Turbo Tax when you could just fill in the forms yourself for free. But that has nothing to do with Direct File.

insane_dreamer

3 hours ago

The Trump Administration is hell bent on doing everything it can to benefit large corporations at the expense of the American people.

Cash App offers free Fed and State filing and it's quite good (used it last year for the first time). Not many people know about it though.

chneu

6 minutes ago

FreeTaxUSA

girl2

4 hours ago

This wont bode well.........

polski-g

4 hours ago

Turbo tax is free for federal filers with no business income, same thing as this service. Except now no taxpayer dollars were spent on maintaining this. This would have been useful if it also did state taxes, which turbo tax is not free for.

loco5niner

4 hours ago

They were rolling out matching services state by state. Something like 12 last year. And Turbo tax is NOT "free for federal filers with no business income". Just look at the Costco Turbotax stands every year.

dmoy

3 hours ago

No business income (including no Uber/doordash/etc due to schedule SE?), no dividends over $1500, no itemized deductions, no capital gains, no nanny (like you hiring a nanny), no unemployment income, no gambling winnings, no alimony, etc etc

beej71

3 hours ago

The federal government doesn't do state taxes.

Luckily for me, my state rolled out its equivalent of Direct File a couple years ago, and it's fantastic. Just like Direct File was.

charcircuit

4 hours ago

With the rise of AI there is no excuse on why tax software should be so hard to make.

estimator7292

4 hours ago

The entire reason that tax software is hard is that it can NEVER produce a wrong answer. Plus tax law is about ten thousand times more complicated than you're assuming.

dlcarrier

3 hours ago

No tax software or expert will never produce a wrong answer, because too many questions have no guaranteed right answer, due to inconsistent interpretatios within the IRS.

Tax filing is a matter of risk balancing, which heuristics are great at optimizing, if they incorporate enough data. Neural networks are ideal for that, but it would take a lot of data gathering to develop the model, from data that isn't easily scraped from Web pages.

esprehn

4 hours ago

People file incorrect tax amounts all the time. It's the government's job to verify the return and either refund you or request more money. There's a decent margin for error, and not all returns are audited so the IRS must also have a margin for error they're building policy and budgets around.

wilg

3 hours ago

1% of returns filed by tax software have errors, which is infinitely more than 0%

charcircuit

4 hours ago

>it can NEVER produce a wrong answer

As the government it should be possible to reduce the negative impact of making mistakes.

>Plus tax law is about ten thousand times more complicated than you're assuming.

Then start simple. You don't have to cover all of tax law at the start.

SamuelAdams

4 hours ago

You’re going to give your tax data - some of the most sensitive data to some constituents - to OpenAI / Google / some other startup?

That seems like a nightmare of a product as far as privacy is concerned.

terminalshort

2 hours ago

The only reason I care about companies having my data is that it means the government can get to it. In this case I am required to give my data to the government anyway, so why would I care if OpenAI / Google has it?

simonw

4 hours ago

I think they meant that it should be a lot faster to develop software that implements the tax code with the assistance of AI coding tools.

latexr

3 hours ago

You need legal documents to be accurate and deterministic, not for some LLM to make shit up and have you inadvertently and incompetently lie to the IRS.

amluto

4 hours ago

ISTM one ought to be able to use AI to translate the official IRS forms to a machine readable format. No personal data needs to go anywhere near the AI.

Even if you do want to feed your personal data to an AI tax bot, this should be easily within the capabilities of a model that can run locally.

sublinear

4 hours ago

> translate the official IRS forms to a machine readable format

The instructions for each form published by the IRS every year are already written by professional technical writers to be unambiguous. Do you mean that someone ought to write a simplified english grammar transpiler? I think that would genuinely be interesting. What's missing are the guidelines the technical writers are using, but that can probably be derived.

gdulli

4 hours ago

Satire requires a clarity of purpose and target, lest it be mistaken for, and contribute to, that which it intends to criticize.

tombert

4 hours ago

I'm surprised that there hasn't been an "this is good for bitcoin" comments yet.