Gov. Phil Murphy on Wednesday joined with the U.S. Department of Treasury to announce the Garden State will participate in IRS Direct File, beginning in 2025.

The program rolled out as a pilot across 12 states in the 2024 filing season. New Jersey did not participate because of a tech upgrade the state was undergoing at the time. During that pilot, more than 140,000 taxpayers claimed over $90 million in refunds. They also saved an estimated $5.6 billion in filing costs.

Less than two months ago, Treasury and the Internal Revenue Service announced that following the successful rollout they will permanently offer Direct File, inviting all 50 states to participate starting next filing season.

“New Jersey, like in so many other things, was the first state to say that they wanted to take advantage of this, because of the governor’s leadership in making sure that we reduce costs for the people of New Jersey,” said U.S. Department of the Treasury Deputy Secretary Wally Adeyemo during a July 23 press call with reporters announcing the news. “And that’s why I’m happy to be here with him today announcing that New Jersey is going to offer its residents Direct File in 2025.”

For the first time, Adeyemo said, New Jerseyans with simple tax returns will be able to file online, for free, directly with the IRS.

Saving time and money

“Meeting your tax obligations and claiming the credits, deductions, and refunds for which you’re eligible should be easier going forward,” said Adeyemo.

He noted the program is funded through the Inflation Reduction Act.

“It’s no secret that filing your taxes is way more complicated than it needs to be,” said Murphy, noting the time, red tape, costs and stress associated with tax season.

According to the governor’s office, more than 1.3 million New Jerseyans will be eligible to use the free online filing tool during the next filing season.

“The Direct File tool is revolutionary to our federal tax filing process, and it will make a world of difference for taxpayers in New Jersey and across the country,” said Murphy. “By cutting costly, for-profit tax filing software out of the equation with the free Direct File tool, we are saving individuals and families in our state time and money.”

“Direct File will save New Jersey taxpayers time and money and help ensure they receive the tax benefit for which they are eligible,” said U.S. Secretary of the Treasury Janet Yellen in a press release. “We are pleased to welcome New Jersey as the next state to offer this new free option to taxpayers.”

State Treasurer Elizabeth Maher Muoio said that her department knows how expensive and time-consuming tax preparation can be.

“Direct File will provide New Jersey taxpayers with an innovative new, free, and efficient tax filing option,” said Muoio. “We look forward to working with our partners at U.S. Treasury to ensure our residents have access to this exciting new program, in the coming tax year and beyond.”

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