This tax season offers a profound change in how 640,000 Oregonians will be able to file their taxes. Direct File is an online tool that allows people to easily prepare and file their tax returns with the Internal Revenue Service (IRS) for free. Currently, however, Direct File does not work for those who itemize deductions or who have business income to report.
Last year the IRS tested Direct File in 12 states, producing overwhelmingly positive reviews by users. This tax season, Direct File has been expanded to 13 additional states, including Oregon. Once users file their return with the IRS using Direct File, the system will direct them to Oregon’s own Direct File system. The federal and the state systems are synced, meaning users will not have to re-enter information from their federal return when filing their state return.
Another benefit of the Direct File system is that it will pre-populate personal information and certain figures from a filer’s W-2.
The Oregon Center For Public Policy estimates that Direct File could save Oregon taxpayers more than $100 million in filing fees, while making it easier for families to claim certain tax credits. Credits like the Earned Income Tax Credit and the Child Tax Credit can only be claimed by filing a tax return. The complexity and cost of filing taxes have been obstacles that may have prevented people from claiming these credits in the past.
To find out if you are eligible for Direct File and to use this system to file your taxes, visit directfile.irs.gov. The site also provides guided help for every part of the federal tax return and provides access to live support from IRS staff Monday-Friday, 7 am-10 pm Eastern time (4 am-7 pm Pacific).
