IRS Direct File Shows Value of Prototypes, Says Product Manager – MeriTalk

The IRS’s Direct File pilot program, which the agency conducted earlier this year, proves the value of developing product prototypes in the federal government before they are fully deployed, the project’s product lead said during Biden and Harris’s President’s Management Agenda event on July 10.

The IRS successfully tested its Direct File tool during the 2024 tax season, allowing more than 140,000 taxpayers in 12 states to file their tax returns directly with the agency electronically. The program was made permanent on the 30th of May.

“One of the mistakes we often make, and one of the missteps that government IT can risk, is that we have such a large audience – 335 million people as a locked-in audience for everything we do – that we tend to bet on the stars and launch with something that takes way too long to develop, that takes years and hundreds of millions of dollars to pull off. And then we find out three, four years later that it doesn’t work,” said Chris Given, direct file product lead at the IRS.

“One of our goals with Direct File was we said, ‘We’re not going to wait. We want to get it in taxpayers’ hands as quickly as possible.’ The IRS spent $24.6 million to develop and test Direct File,” Given said. “But taxpayers are already using it. They’re using something, and it’s not the stars and the moon, the scope is very limited. We’ve only rolled it out in 12 states, but it’s in taxpayers’ hands. We know we’re on the right track.”

“Next year we can start expanding, keep building Direct File and eventually reaching more and more taxpayers. We’re not there yet,” he said. “We started small and were able to build, but I think even before we started, we started Direct File by building a prototype of it.”

Merici Vinton, co-director of the Direct File program at the United States Digital Service (USDS), recalled that the pilot project was launched with only one taxpayer – and the program did not work as planned.

“We rolled out Direct File in a very phased manner, meaning we wouldn’t make it available to a larger and more progressive audience until we were confident the product could scale,” Vinton said.

“If we had all called … live, it wouldn’t have worked,” she explained. “The connection didn’t work. (The tax return) was in a queue.”

“Once we reset the connection, it worked and the data was delivered as expected. But if we had gone live without that first data processor, or if we had made the data available to the masses, it would have been a mistake,” Vinton said. “Not only a mistake, our users would not have had confidence in the data.”

Building trust was an important part of the Direct File pilot program. Given said they conducted a survey after users filed their taxes with Direct File, and 86 percent of taxpayers said their experience with Direct File increased their trust in the IRS.

“When we looked at what it meant for the IRS to offer this new service, one of the key ideas was to change the (taxpayer’s) relationship with the IRS,” Given continued, “from the role of the IRS telling you what you did wrong to the role of the IRS helping you do it right. And that was a real shift that we wanted to achieve with this service and with every detail of the project.”

Given the success of the Direct File pilot program, Given hopes to eventually expand it to provide better customer service to taxpayers by informing taxpayers about additional government services they are eligible for.

“Taxes and tax returns are an annual check-in with someone. We learn about your income, we learn about your children, and we help you file a tax return,” he said. “That same information could be used to say, ‘Hey, you may be eligible for SNAP. Hey, you may be eligible for Medicaid. You may be eligible for heating subsidies or child care subsidies or any of these other programs.’ How can we use what we learned in Direct File to direct you to these other resources that exist at another agency and at the state level?”

“I think this is a really powerful front door to government once we get to that critical mass,” Given said. “It’s a key element, and I’m very excited about the possibilities of Direct File.”