Why is the IRS Trying Out a New Program?

The IRS is conducting a trial of a new program due to the Inflation Reduction Act, 

which was signed into law by President Joe Biden in August 2022. 

This act mandated the IRS to explore the possibility of creating and operating a free, 

direct electronic tax filing system that's accessible to all taxpayers.

The IRS, led by Werfel, is responsible for assessing several key aspects. 

This includes evaluating how user-friendly the system is, the effectiveness of customer service representatives in answering questions, 

and gauging the interest among taxpayers in participating in an IRS-run program called Direct File.

The testing phase will concentrate on a specific range of tax returns. 

The IRS expects the pilot program to include returns involving elements like W-2 wage income, unemployment compensation, 

Social Security and railroad retirement income, and interest earnings of $1,500 or less.

This trial is essential for ensuring that the program is both feasible and beneficial for taxpayers.

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