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Congress May Kill Chance of Free IRS Tax Filing

ProPublica reports that a bipartisan bill would bar the creation of such a system
By Newser Editors,  Newser Staff
Posted Apr 9, 2019 1:54 PM CDT
File photo of a 1040 tax form.   (AP Photo/Mark Lennihan, File)

(Newser) – It's beginning to look like the IRS will never provide a free online tax-filing system for Americans, reports ProPublica. The news outlet blames heavy lobbying from the likes of TurboTax and H&R Block. A bill with bipartisan support has cleared the House Ways and Means Committee, and one of its provisions bars the IRS from creating its own electronic tax-filing system. A companion bill is moving through the Senate. That kind of a system could put a serious dent in the profits of companies that charge fees to prepare people's taxes, and Justin Elliott writes that H&R Block and TurboTax parent Intuit spent $6.6 million last year alone lobbying against such a change.

As a compromise, the IRS currently has a memorandum of understanding with the Free File Alliance, an industry group, stipulating that companies such as TurboTax provide free tax software to taxpayers who make less than $66,000. However, only 3% of people eligible for the program use it, and critics say it's because most of those eligible are unaware it exists, per Fortune. Advocates for an IRS system note that the agency already has on hand much of the information taxpayers need to fill out their forms. (Refunds are coming in smaller than usual this year because of new tax changes.)

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