Tax Prep Lobbyists Want To Kill The IRS's Free File Plan

The lucrative tax prep industry has pursued a decades-long lobbying campaign to block the IRS from developing a free online tax filing service.

by David Moore, Sludge

As the tax preparation industry fights against the Internal Revenue Service offering a free e-filing system, one of its lobbying groups has hired three new lobbyists with ties to the congressional committees that oversee the IRS.

The lobbyists were hired on May 1, shortly before the IRS announced on May 16 that the Treasury Department has directed it to take a long-awaited next step and develop a free e-filing tool, in what it calls a “limited pilot” for the 2024 tax season. The announcement came on the same day the IRS submitted a feasibility study of such a system to Congress, which was required by a provision in the Inflation Reduction Act (IRA) that Congress passed last year. They are planning to lobby on “Issues related to tax administration and tax-time financial products,” according to a Senate filing.

urbotax intuit website on iPhone 12 pro screen with 1040 and w-2 paper tax forms on United States flag

The new lobbyists work for the law firm Brownstein Hyatt Farber Schreck and were retained by American Coalition for Taxpayer Rights (ACTR), a trade association founded in 2011 by several tax prep companies. The group’s members include the two largest industry players in Intuit, owner of TurboTax, and H&R Block, as well as Republic Bank, Liberty Tax Services, and software company TaxSlayer.