A new service that allows Americans to file their taxes for free launched in 12 states Tuesday.

Offered by the U.S. Department of the Treasury and the Internal Revenue Service, Direct File is available to 19 million Americans with simple tax situations as part of a pilot program the IRS hopes to eventually roll out to other states.

What You Need To Know

  • Direct File is a new, free tax-filing service offered by the Treasury Department and Internal Revenue Service

  • The system is available to 19 million taxpayers in 12 states starting Tuesday at 1 p.m. ET

  • Direct File is launching in Arizona, California, Florida, Massachusetts, New Hampshire, Nevada, New York, South Dakota, Tennessee, Texas, Washington and Wyoming

  • Geared toward working-class and middle-class Americans, Direct File is available only to those who file simple taxes

“Filing taxes is expensive and time consuming for American taxpayers. Individual taxpayers spend around 13 hours and approximately $270 to prepare and file one annual tax return,” Deputy Secretary of the Treasury Wally Adeyemo said Monday during a briefing about the new program.

Available in English and Spanish 24 hours a day, seven days a week, the system launches at 1 p.m. ET Tuesday. Adeyemo said the program works on smartphones as well as laptops and “shows taxpayers the math every step of the way so they can make sure that the return is accurate and they’re getting the full refund they’re entitled to.”

Geared toward middle-class and working-class Americans who make less than $400,000 annually, Direct File is currently available only to those who file simple taxes. The IRS cited parents with W-2 incomes that claim the earned income and child tax credits, recent graduates with W-2 incomes who pay student loan interest and retired senior citizens with Social Security incomes as being eligible to use Direct File.

“We estimate that Direct File covers one third of tax situations,” Adeyemo said, or roughly 19 million taxpayers in the 12 states that are piloting the program.

Direct File is launching in Arizona, California, Florida, Massachusetts, New Hampshire, Nevada, New York, South Dakota, Tennessee, Texas, Washington and Wyoming.

Adeyemo said 15,000 Americans have already used the system as part of a test. He anticipates 100,000 taxpayers will use Direct File this year.

Funded through the Inflation Reduction Act, Direct File is “an example of how our administration is working to make government work better and smarter for the American people and create tools that make working families’ lives easier,” Deputy Chief of Staff to President Biden Natalie Quillian said during Monday’s briefing.

She said the first Direct File pilot user saved $400 and was able to complete her taxes in about an hour.

National Economic Advisor Lael Brainard said the Direct File program could save the average user $160 in filing fees each year.