When the so-called Department of Government Efficiency (DOGE) arrived at the Internal Revenue Service earlier this year, leaders of the group reassured workers that the agency’s free tax filing tool, Direct File, would be spared from cuts. But only a few days after meeting with tax software lobbyists, the beloved tool was placed on the chopping block, multiple sources familiar tell WIRED.
The plans to potentially kill Direct File, the free tax filing tool developed by the IRS which services 25 states, was initiated by Sam Corcos, CEO of an Andreessen Horowitz–backed health startup that has ties to SpaceX. Corcos’ suggestion to cut the popular service was presented to Treasury Secretary Scott Bessent in the beginning of March, multiple sources familiar say.
The weekend before Corcos suggested ending Direct File, he spoke of it positively to IRS engineers. By Friday, he had changed his tune. As sources WIRED spoke to understand it, Direct File would remain online through the 2025 tax filing season but would likely be dead by next year.
“Throughout the week, the tone had shifted,” says one source. The decision to end Direct File “came out of nowhere.”
Days after the weekend meeting, Corcos told multiple sources that he had met with Free File Inc. (previously the Free File Alliance), a group of tax preparation software companies that partner with the IRS to offer free online tax filing services. The group was organized by Intuit, which produces TurboTax, more than 20 years ago as a means of offering free filing services to lower-income taxpayers. In return, the IRS promised not to create its own government-run online filing system.
Before Inauguration Day in January and well into the following month, DOGE leadership, including Steve Davis, CEO and president of Elon Musk’s Boring Company, and Amy Gleason, acting administrator for the US DOGE Service, said they were impressed with the Direct File project and reassured the engineering team working on it that it was safe, multiple sources tell WIRED. (Though Davis stepped away from government last month, he continued to lead meetings and deliver orders to DOGE representatives. This included Corcos, who reportedly refused to cooperate, and Davis attempted to oust him.)
The IRS did not immediately respond to a request for comment from WIRED. Corcos now serves as the Treasury’s chief information officer.
“We think [the IRS] ought to wind it down, and they ought to focus their attention on other key priorities like modernization,” David Ransom, a tax lobbyist representing the American Coalition for Taxpayer Rights, told NOTUS in April. At least two tax preparation companies represented by the American Coalition for Taxpayer Rights, TaxSlayer and TaxHawk, also belong to the Free File Alliance. (By 2021, Intuit and H&R Block left the Free File Alliance.)
Prior to Intuit’s departure, ProPublica reported that code had been introduced into the company’s version of the Free File website that essentially hid the service from search engines like Google, making it nearly impossible to find without directly navigating to it.