Taxpayer Watchdog Condemns IRS Direct File After Damning GAO Report

For Immediate Release

Contact: Kara Zupkus, (224) 456-0257

WASHINGTON, D.C. – Today, the Government Accountability Office (GAO) released a damning report on the Internal Revenue Service’s (IRS) Direct File program. Among the findings,  the “GAO and the Treasury Inspector General for Tax Administration found that IRS had no documentation to support the underlying data, analysis, or assumptions used for Direct File cost estimates.” Further, the report states that the IRS has failed to collect the data needed to provide promised cost updates in light of its ongoing Direct file filing program.

David Williams, president of the Taxpayers Protection Alliance, offered the following comment:

“Having the IRS prepare your taxes is a bad idea, and the GAO report provides yet another reason why the IRS is woefully unprepared to roll out its own tax preparation service. Providing complete and transparent costs estimates is an important and basic part of any agency’s work, yet the IRS has repeatedly failed to do so. In its eagerness to expand its own mandate, the agency has also demonstrated that it neither knows nor cares what its self-aggrandizement will cost the American taxpayer.

“As occurred during the rollout of Healthcare.gov, many of the highest costs of launching a massive online platform occur in the early years of its existence. Nonetheless, the IRS omitted start-up costs (including technology costs) from its analysis. These errors mislead taxpayers regarding Direct File’s likely fiscal burden on the public. What’s more, although the IRS claims a Direct File program would save taxpayers money, according to the GAO, the agency could not be bothered to ‘consistently’ do these calculations in a credible manner.

“What was revealed today should be a scandal. Direct File is a fundamentally flawed concept. The IRS had dubious statutory authority to move beyond a study to a pilot program. Now, days before Tax Day, the GAO has revealed that it has been sloppy and non-transparent with the American people, underscoring the fact that it should not be trusted to file anyone’s taxes.”