IRS has 'no more excuses' not to create free tax filing software, Warren says

As of Jan. 1, there are higher minimum wages in a quarter of the states, and new federal overtime rules. The IRS has new W-4 forms owners will need to get used to. Plastic bags are on their way out at stores and other businesses in a growing number of places around the country. And California has new laws on freelancers and consumer privacy that can affect out-of-state companies.

Massachusetts Sen. Elizabeth Warren, a 2020 presidential hopeful, is renewing calls for the IRS to create free tax filing software in light of a recent adjustment the agency made to its Free File program.

The senator took to Twitter on Monday night to urge the IRS to consider creating software now that it has amended a memorandum of understanding with third-party preparers eliminating a clause that had prevented it from doing so.

A spokesperson for the IRS did not immediately return FOX Business’ request for comment.

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Warren complained that the IRS had not gone far enough by eliminating the Free File program altogether, which she alleges has “let giant companies trick taxpayers into paying for services that should be for free.”

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Warren introduced the Tax Filing Simplification Act in April 2019, which aims to streamline the filing process for those with relatively simple tax situations. The bill would – first and foremost – direct the IRS to develop a free tax preparation and filing service. Taxpayers could choose a “return-free option,” whereby they would be provided a pre-prepared return. For those who still want to fill out their own forms, lawmakers are seeking to allow taxpayers to download third-party tax information that the IRS already has on file into a software program of their choosing.

She introduced similar legislation in 2016.

Meanwhile, New York Democratic Rep. Alexandria Ocasio-Cortez has also suggested that the IRS should file taxes on behalf of Americans with simple financial situations.

“Long-term, we should be looking at a solution where everyday people do not necessarily have to spend hours every year preparing tax returns, when the majority of Americans have relatively simple and straight-forward returns," she said.

The Free File program was called into question after ProPublica reported that some companies were engaging in deceptive practices and obscuring their free products from organic searches. Individuals with incomes of $69,000 or less are eligible to file for free through the IRS’ Free File program.

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