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After Lobbying Blitz, Trump IRS Formally Kills Direct File Program That Would've Saved Americans Billions
"It was never about efficiency, it's about Trump and his billionaire allies taking money from our pockets to make the tax system worse and line the pockets of big business elites in this predatory industry," said a spokesperson at Americans for Tax Fairness.
Aug 01, 2025
In a move backed by private tax-filing corporations, the administration of U.S. President Donald Trump officially announced the shut down of the government's free Direct File service this week.
For two years under the administration of former President Joe Biden, the IRS allowed taxpayers in some states to file their taxes online using public software under a pilot program.
A report published in March by the Economic Security Project found that:
At maturity in five years, Direct File would save the average user $160 in filing fees and hours of their time each year, which saves Americans a total of $11 billion annually between filing fees and time costs. By breaking down barriers to filing, Direct File would also deliver up to $12 billion each year in additional tax credits to low-income families currently missing out.
In January, the direct file system was rolled out to 30 million Americans across 25 states, to rave reviews. According to a memo circulated within the Internal Revenue Service (IRS), the program was "beloved by its users," with a 94% satisfaction rate among those who used it.
But according to IRS Chairman Billy Long, who spoke at a tax summit Monday, it will not be made available again in 2026.
"You've heard of direct file, that's gone," Long gloated. "Big beautiful Billy wiped that out."
"I don't care about Direct File. I care about direct audit," he added, referring to his efforts to make it easier for businesses and individuals under tax audits to get updates on their status.
The budget legislation that Trump signed into law last month did not formally end Direct File, as Long suggested. However, it did allocate $15 million to the Treasury Department for a task force to study public-private partnership alternatives to replace Direct File. "Big beautiful Billy" likely referred to Long himself, whose IRS formally ended the program.
Long's announcement was the culmination of a months-long scheme by private tax-filing corporations like Intuit and H&R Block, and Republicans in government to kill Direct File.
As early as December, following Trump's reelection victory, GOP congresspeople began calling for the program's demise. Twenty-nine of them, who'd accepted a combined $1.8 million in campaign donations from the tax prep industry over their careers, signed onto a letter written by Reps. Adrian Smith (R-Neb.) and Chuck Edwards (R-N.C.) calling on Trump to issue a "day-one executive order" killing the program.
Long, himself a former congressman from Missouri, raised eyebrows in January 2025, shortly after he was named as Trump's nominee to lead the IRS. According to The Lever, he received a curious $137,000 worth of donations that he then used to pay himself back for a $130,000 loan he'd made to his failed 2022 campaign for the Senate. Around a third of the money came from tax consultancy firms.
In March, following mass layoffs at the IRS by Elon Musk's Department of Government Efficiency (DOGE), staff working on the Direct File system were told to halt their work. Prior to that, Musk wrote on his social media app X that he had "deleted" 18F, the government agency working on the project.
Right after tax day in April, The Associated Press first reported that the administration was planning to end the program.
While consumer advocacy groups called the change a "big loss" for the public, the American Coalition for Taxpayer Rights, an astroturf group backed by tax-filing companies, thanked Smith, Edwards, and other GOP congresspeople "for their leadership" calling for the termination of the program.
The program was effectively dead for months, but Long's gleeful coroner's report this week made it official.
"Last year, Direct File saved taxpayers $5.6 million in tax preparation costs by allowing people to file their taxes for FREE," wrote Rep. Alexandria Ocasio-Cortez (D-N.Y.) Friday on X. "That's why tax preparation companies like... Intuit lobbied to get rid of it. Trump just gave them their wish."
Despite claims by GOP congresspeople that the program was "wasteful," it actually saved taxpayers much more money than it cost. According to the Economic Security Project's study, "For every dollar invested in the program, Direct File delivers $106 in benefits to American taxpayers, between savings on tax preparation fees and access to untapped tax credits."
"This move exposes what's really happening in Trump's administration," said David Kass, the executive director of Americans for Tax Fairness. "It was never about efficiency, it's about Trump and his billionaire allies taking money from our pockets to make the tax system worse and line the pockets of big business elites in this predatory industry."
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GOP AGs Urge Congress to Crack Down on Shield Laws and Telehealth Abortions
The Republican coalition targeted California and New York, both home to doctors who have been targeted by legal cases for allegedly providing abortion pills to patients in states with strict bans.
Jul 30, 2025
While a recently filed lawsuit in Texas jeopardizes the future of telehealth abortions, some Republican state attorneys general don't want the GOP-controlled Congress to wait for the results of that case, and this week urged leaders on Capitol Hill to consider passing federal legislation that would restrict doctors from shipping pills to patients to end their pregnancies.
Since the U.S. Supreme Court's right-wing majority ended nationwide abortion rights with Dobbs v. Jackson Women's Health Organization three years ago, anti-choice state lawmakers have ramped up efforts to restrict reproductive freedom. At the same time, some Democratic officials have enacted "shield laws" to protect in-state providers and traveling patients.
Led by Arkansas Attorney General Tim Griffin, 16 state AGs on Tuesday wrote to top congressional leaders from both parties, calling on them to "assess the constitutional authority it may have to preempt shield laws."
Griffin also sent cease-and-desist letters to two entities shipping abortion medication within the United States and two website companies that provide services to LifeOnEasyPills.org. Reporting on the AG's press conference, South Carolina Daily Gazette noted that "if the entities don't cease advertising abortion pills in Arkansas, Griffin said his office may bring a lawsuit against them for violating the state's deceptive trade practices law."
While Griffin also "said he believes what he is asking lawmakers to do is different from a federal abortion ban that the closely divided Congress has seemed hesitant to tackle," according to the Daily Gazette, advocates for reproductive rights disagreed.
Responding to the letter to Congress on social media, the advocacy group Reproductive Freedom for All shared a petition opposing a national abortion ban. It says that Republican President Donald Trump "has proven time and time again that he is out of touch with the 8 in 10 Americans who support protecting abortion rights."
"On the campaign trail he spewed whatever lies he could to get him reelected. Now he'll use the Project 2025 playbook to further restrict our right to access abortion, contraception, fertility treatments, and more," the petition warns. "We must stop him."
Yesterday, 16 Republican attorneys general sent a letter to congressional leadership urging them to override state telemedicine abortion shield laws.Sign the petition below to stand up to Republican lawmakers!act.reproductivefreedomforall.org/a/no-nationa...
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— Reproductive Freedom for All (@reproductivefreedomforall.org) July 30, 2025 at 3:48 PM
In addition to Griffin, the Tuesday letter is signed by the attorneys general of Alabama, Florida, Idaho, Indiana, Iowa, Kansas, Louisiana, Missouri, Nebraska, Oklahoma, South Carolina, South Dakota, Texas, West Virginia, and Wyoming.
The GOP coalition targeted two states, arguing that "when New York or California refuses to respect a criminal prosecution or a civil judgment against an individual who is accused of violating the abortion laws of another state, they are refusing to give full faith and credit to that state's judicial proceedings."
Last December, Texas Attorney General Ken Paxton announced a first-of-its-kind lawsuit against a provider in New York. He sued Dr. Margaret Daley Carpenter, co-founder of the Abortion Coalition for Telemedicine (ACT), for providing two drugs used in medication abortions—mifepristone and misoprostol—to a 20-year-old resident of Collin County.
In February, on the same day that Texas State District Judge Bryan Gantt ordered Carpenter to pay over $100,000 in fines and fees, Louisiana Attorney General Liz Murrill sought to extradite the ACT doctor. Her state classifies mifepristone and misoprostol as dangerous controlled substances.
While Republican Louisiana Gov. Jeff Landry signed the extradition warrant sought by Murrill and the district attorney, New York is one of nearly two dozen states with shield laws for reproductive healthcare, and its Democratic governor, Kathy Hochul, said that "I will not be signing an extradition order that came from the governor of Louisiana—not now, not ever."
On Monday, Paxton took legal action against Taylor Brucka, the clerk in Ulster County, New York, for refusing to make Carpenter pay the $100,000 penalty. Bruck told The Guardian that "it's really unprecedented for a clerk to be in this position" and "I'm just proud to live in a state that has something like the shield law here to protect our healthcare providers from out-of-state proceedings like this."
Meanwhile, another case involving a California doctor emerged in Texas earlier this month: A man filed a wrongful death lawsuit against Dr. Rémy Coeytaux for allegedly mailing to Galveston County medication that his girlfriend used to end her pregnancy. His lawyer is Jonathan Mitchell, an "anti-abortion legal terrorist" who previously served as the state's solicitor general and was the chief architect of its law that entices anti-choice vigilantes with $10,000 bounties to enforce a six-week ban.
Mary Ziegler, an abortion historian and law professor at the University of California, Davis, recently told Mother Jones that "the whole game for Jonathan Mitchell is to get into federal court... both because he wants to shut down doctors in shield law states, like everyone in the anti-abortion movement, and because he wants a federal court to weigh in on the Comstock Act," a dormant 1873 law that criminalized the shipping of "obscene" materials, including abortifacients.
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Progressive Group Takes Aim at Four Texas Republicans Who Voted to Cut Medicaid in New Ads
"We're holding these members of Congress accountable for voting for the Republican tax law that strips health care away from millions of Texas families," said Unrig Our Economy campaign director Leor Tal.
Jul 28, 2025
The progressive advocacy group Unrig Our Economy launched a new $2 million advertising campaign Monday against four Texas Republicans who voted for the massive Medicaid cuts in this month's GOP megabill.
At the behest of President Donald Trump, Republican Texas Gov. Greg Abbott is mounting an unusual mid-decade effort to redraw Texas' congressional map to keep control of the U.S. House of Representatives come 2026.
The plan is expected to net the GOP five seats. But the flipside is that some seats that were once GOP locks may become more vulnerable to Democratic challengers.
Those include the ones held by Republican Reps. Lance Gooden (5), Monica De La Cruz (15), Beth Van Duyne (24), and Dan Crenshaw (2)—all of whom voted for the "One Big Beautiful Bill Act."
Put together, these four congresspeople alone represent around 450,000 Medicaid recipients, according to data from KFF.
The law remains dismally unpopular, with the majority of Americans believing that it benefits the rich, while providing little to ordinary Americans. According to a Navigator survey conducted last week, 7 in 10 Americans said they were concerned about its cuts to Medicaid.
The Congressional Budget Office projects that 10 million Americans will lose health insurance as a result of the law's Medicaid cuts.
Around 200,000 of them are in Texas according to KFF. In total, up to 1.7 million people in the state may lose their insurance as a result of other subsidies that were also cut.
Those are the people Unrig Our Economy hopes to reach with its new ad blitz.
One ad hits Crenshaw—whose district has nearly 92,000 Medicaid recipients—for making false promises to protect the program.
(Video: Unrig Our Economy)
It shows a video of the congressman from May 14 assuring Texans: "You have nothing to worry about. Your Medicaid is not going anywhere," less than two months before voting for "the largest Medicaid and healthcare cuts in history."
Another singles out De La Cruz—who represents over 181,000 Medicaid recipients—for her vote for the bill after warning that the cuts "would have serious consequences, particularly in rural and predominantly Hispanic communities where hospitals and nursing homes are already struggling to keep their doors open."
Among hundreds at risk across the country, 15 rural hospitals in Texas are in danger of closing because of the cuts, according to a study by the health services research arm of the University of North Carolina.
The ads targeting Gooden and Van Duyne, meanwhile, draw more attention to the effects of their cuts on Texan families: "Medicaid covers a third of all children, half of all pregnant women, the elderly in long-term care, and the disabled."
(Video: Unrig Our Economy)
Gooden's district contains more than 120,000 Medicaid recipients—over half of whom are children. In Van Duyne's district, children make up close to two-thirds of the more than 57,000 enrollees.
According to the Institute on Taxation and Economic Policy, the bill cuts more than $930 billion in total from Medicaid over the next ten years. Over that same ten-year period, the wealthiest 1% of Americans will receive over $1 trillion worth of tax breaks.
All the ads hammer home the fact that these devastating cuts were passed "to fund tax breaks for billionaires."
Unrig Our Economy's ad blitz is the first salvo of a $20-million effort by the House Majority PAC—the largest national PAC supporting Democrats—to beat back the effects of the Republican gerrymandering effort.
"We're holding these members of Congress accountable for voting for the Republican tax law that strips healthcare away from millions of Texas families," said Unrig Our Economy campaign director Leor Tal.
Unrig Our Economy has launched similar ads against vulnerable Republicans across the country, such as first-term Rep. Rob Bresnahan, whose northeast Pennsylvania constituency is made up of more than one-fourth Medicaid recipients.
"These ads," Tal said, "are just the latest in our nationwide campaign to show the horrible impacts of this law, which benefits the superwealthy at working families' expense."
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