Tax season is set to become less of an headache for Oregon taxpayers from 2025, thanks to a collaboration between the Oregon Department of Revenue and the IRS that will see the introduction of a free electronic filing option. This partnership ensures that residents who prepare their own tax returns can e-file their federal and state income tax returns at no cost, as announced by the Oregon Department of Revenue.
Oregon Governor Tina Kotek hailed the initiative, stating, “The Direct File Program is a game-changer for taxpayers." Kotek added, "This free filing option is an equitable opportunity to save Oregonians time and money, regardless of their income." The IRS Direct File system underwent a trial during the 2024 tax season with limited tax situations covered. It proved successful enough for the program to expand its capacity for the upcoming 2025 filing period.
The expanded selection of IRS Direct File will now accommodate tax situations involving Forms 1099 with interest income over $1,500, retirement income, and even the Form 1099 for those lucky Alaska residents cashing in on the Alaska Permanent Fund dividend. The release from the Oregon Department of Revenue includes a graphic detailing who exactly can take advantage of the IRS Direct File in 2025.
In the 2024 tax season, the pilot program saw significant use — over 140,000 taxpayers in 12 states e-filed federal tax returns, while close to 7,000 Oregonians used the Direct File Oregon option for their state returns. The IRS forecasts that 30 million US taxpayers will be able to utilize IRS Direct File in 2025, which includes 640,000 Oregon taxpayers eligible to e-file both their federal and state taxes for free
