Tax Season 2024: Expanded Direct File Program and New Reporting Rules

Direct File Program Extension

The IRS has expanded its Direct File program to 13 additional states, bringing the total to 25. This portal allows individuals to submit tax returns directly to the IRS for free. New features this year include:

* Ability to import W-2 information automatically from the IRS
* Support for a wider range of tax situations, including credits like:
* Earned Income Tax Credit
* Child Tax Credit
* Premium Tax Credit
* Credit for the Elderly and Disabled
* Retirement savings contribution credits

Eligibility Requirements for Direct File

* Individual filers: Less than $200,000 in wages or $168,000 with multiple jobs
* Joint filers: Less than $250,000 in wages
* Separate filers: Less than $125,000 in wages each
* Income limitations apply, including no capital gains or rental earnings

1099-K Reporting Threshold Lowered

Third-party payment apps like PayPal and Venmo will now issue 1099-K forms to businesses with at least $5,000 in transactions (reduced from $20,000). This measure aims to prevent tax evasion.

Zelle Exemption

Zelle is not subject to the new reporting requirements due to its unique operating model and will not issue 1099-Ks.

Standard Deduction Increase

The standard deduction has increased to $14,600 for individuals and $29,200 for couples, simplifying tax filing for the majority of Americans.

Additional Information

For more details on your eligibility for Direct File within each state, visit the IRS website. The Free File program is still available for individuals making less than $84,000 per year. Taxpayers should note the potential delays in customer service due to the federal hiring freeze.