Sen. Elizabeth Warren (D-Mass.) said tax-prep companies are spending heavily to block her bill to revive the IRS's free Direct File program.
"Tax prep companies are spending big to block my bill," Warren wrote. "Because I want to make filing your taxes directly with the IRS easy and free. We can’t let them win."
She cited lobbying disclosures involving Intuit Inc (NASDAQ:INTU) and H&R Block (NYSE:HRB).
What Is Direct File?
Direct File was a free, government-run service that allowed eligible taxpayers to file federal returns directly with the IRS without paying a commercial preparer. Launched under the Biden administration, it was used by 296,531 taxpayers during the 2025 season before the Trump administration confirmed it would not be offered for 2026. Treasury Secretary Scott Bessent said there are “better alternatives” and that the private sector can do the job more efficiently.
The Bill And The Lobbying Battle
Warren introduced the Direct File Act in February alongside Rep. Brad Sherman (D-Calif.), with 160 members of Congress co-sponsoring the measure. The bill would permanently enshrine Direct File in law, bar the IRS from entering agreements that restrict free online filing, require seamless integration with participating state systems, and mandate coverage of at least 50% of eligible taxpayers in participating states by the 2028 tax season.
Warren has said Intuit donated more than $1 million to President Trump’s inauguration while lobbying against the program. Intuit told that it has helped more than 140 million people file for free over 12 years and that fewer than 1% of eligible filers used Direct File when it was available.
In December, Warren predicted that TurboTax and H&R Block would raise prices and “rake in huge profits by ripping American taxpayers off” following Direct File’s cancellation. A Politico report noted that industry concerns about Direct File’s competition disappeared after the Trump administration moved to shut it down.
In April, IRS Chief Executive Frank Bisignano said the agency processed 120 million returns and issued 80 million refunds this season, up from 72 million a year earlier, with total refund value rising roughly 11%. IRS data showed the average refund reached $3,571 as of March 20, up 10.9% from $3,221 at the same point last year.
With Direct File gone, taxpayers must file on paper or turn to commercial software and existing limited, free options.
Disclaimer: This content was produced with the help of AI tools and was reviewed and published by Benzinga editors.
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