I was surprised how much I enjoyed reading this. Although it's necessarily opinionate d(the lead author was part of the Direct file team) it comes off as very even-handed, giving equal consideration to successes and failures, and addressing the partisan political environment in factual terms.
It's unusually well-written, providing lots of key details or dropping in relevant context without ever losing sight of the big picture and the looming deadlines. I expected to just read the executive summary and then skim the rest, but it held my attention the whole way through.
Very basic analysis by da bot says it costs the government roughly 226$ per filing vs a private company 40$.
Would love to hear the opposite argument but the point I first saw online is saying the same, that it cost more tax payer money to run than it saved those tax payers.
Scale problem? Open to hearing the opposite argument.
It was a pilot and was open to a small subset of taxpayers. It was intentionally not benefiting from economy of scale to incrementally deliver value rather than probably badly trying to hit every use case the first go around.
The cost per filing criticism is generally posited in bad faith, by people who don’t understand incremental software delivery, or both
Even if that's true, there's no reason it can't be streamlined over time. The true scaling problem is profit. The government has an interest in accurate tax collection -- not collecting a service fee.
I disagree wholeheartedly that there isn’t much to study. Direct File was actually a resounding success, especially when you consider how much difficulty governments tend to have shipping good software products. There is a lot of good information in here that government entities can learn from.
Including how and why it died. That is an important lesson for the entire governmental enterprise, including all decision-makers, to learn: that government CAN deliver something good and one single person should not be in totalitarian control
I think it speaks to doing things "the right way". Direct file could have been mandated by Congress, but it wasn't. Instead it only directed the IRS to do a "study" as a "voluntary agency initiative". That left full control of whether it should be done in the hands of the IRS and the executive branch.
Anyone wheeling and dealing along in the shadows between "politics" and "deliverable, functioning product" should read it. Or, I guess, paste the link into Claude or ChatGPT and ask it to summarize for them, lessons learned in bullet points and how it could apply to $their_job.
But I'm generally a weirdo who finds these kinds of reports fascinating, so don't purely go on my recommendation.
Eh, government should not be in the business of maintaining digital infrastructure, regardless of how capable it might be. As much of it as possible should be contracted out to 3rd parties.
Profit motives in infrastructure are a bad idea. See Thames Water in the UK, for instance. It always introduces a perverse incentive where if the company in control of the infrastructure can extract an extra million in profit by making everything less efficient and costing everyone else involved a billion, it's still in that company's interest to do so.
This is a prime example of that. H&R Block, etc, benefit from there not being direct file by around $3bn in revenue or around $750m in profit. Rough sums on the time saved by direct file if everyone used it is 8h * average wage * taxpayers, which seems to be approximately $44bn. i.e. in axing direct file, it has "created" $3bn in economic activity to the private infrastructure-owner (the intermediary between you and filing your return), but at the cost of $44bn in lost time & therefore lost activity (the other things you could have been doing) to the rest of the economy.
Infrastructure is not the economy. Infrastructure is the thing the economy runs on top of / has to use. Given that it is the role of government to govern the economy, it is the role of government to ensure that the infrastructure is running well (be the custodian of the infrastructure).
Arguing the other side, digital infrastructure shouldn't be such a complicated domain that it is out of the reach of governments. This is the authority we trust to build our roads and virtually every other meaningful infrastructure in our civic life. Why should digital infrastructure be out of bounds?
The only alternative is inserting a third party, one that has full access to all your financial information. That shouldn't be necessary for the average filer, assuming a bare minimum of competence, like once might assume for the only country to put a human on the moon and bring them safely home.
The government has to maintain some infrastructure to get this sort of thing done. Whether digital or analog. And if it contracts it out, it needs to oversee it. So no matter how it is done, the government has to pay.
You could just light the money on fire instead and get the same result. Contractors routinely screw the tax payer. I once had a job in one of these third parties where the entire operation was effectively defrauding the tax payer by claiming 1hr jobs would take 40.
Do you think the government should allow electronic filing of taxes?
Because if the government is going to accept returns electronically instead of through the physical mail, then it should accept them without requiring an intermediary.
Interestingly, it does this for corporations, but not for individuals.
Gee, I wonder why.
Personally, I think that (a) the government needs to have my PII to process my taxes, and that (b) having the government require me to also hand my PII to a third party in order to pay taxes is a big fucking security nightmare.
I was surprised how much I enjoyed reading this. Although it's necessarily opinionate d(the lead author was part of the Direct file team) it comes off as very even-handed, giving equal consideration to successes and failures, and addressing the partisan political environment in factual terms.
It's unusually well-written, providing lots of key details or dropping in relevant context without ever losing sight of the big picture and the looming deadlines. I expected to just read the executive summary and then skim the rest, but it held my attention the whole way through.
Very basic analysis by da bot says it costs the government roughly 226$ per filing vs a private company 40$.
Would love to hear the opposite argument but the point I first saw online is saying the same, that it cost more tax payer money to run than it saved those tax payers.
Scale problem? Open to hearing the opposite argument.
It was a pilot and was open to a small subset of taxpayers. It was intentionally not benefiting from economy of scale to incrementally deliver value rather than probably badly trying to hit every use case the first go around.
The cost per filing criticism is generally posited in bad faith, by people who don’t understand incremental software delivery, or both
Even if that's true, there's no reason it can't be streamlined over time. The true scaling problem is profit. The government has an interest in accurate tax collection -- not collecting a service fee.
Publication homepage with some intro/context instead of direct pdf: https://www.ischool.berkeley.edu/research/publications/2026/...
There isn’t much to study - it didn’t succeed or fail on the merits - someone didn’t like it because he didn’t create it so it got axed.
I disagree wholeheartedly that there isn’t much to study. Direct File was actually a resounding success, especially when you consider how much difficulty governments tend to have shipping good software products. There is a lot of good information in here that government entities can learn from.
Including how and why it died. That is an important lesson for the entire governmental enterprise, including all decision-makers, to learn: that government CAN deliver something good and one single person should not be in totalitarian control
I think it speaks to doing things "the right way". Direct file could have been mandated by Congress, but it wasn't. Instead it only directed the IRS to do a "study" as a "voluntary agency initiative". That left full control of whether it should be done in the hands of the IRS and the executive branch.
> Direct file could have been mandated by Congress, but it wasn't.
Something being mandated by Congress is no protection at times:
* https://en.wikipedia.org/wiki/United_States_Agency_for_Inter...
(Or the Constitution for that matter it seems.)
It had talented software engineers involved including with the marketplace. It succumbed to political forces
A fascinating , yet sad, post-mortem.
Anyone wheeling and dealing along in the shadows between "politics" and "deliverable, functioning product" should read it. Or, I guess, paste the link into Claude or ChatGPT and ask it to summarize for them, lessons learned in bullet points and how it could apply to $their_job.
But I'm generally a weirdo who finds these kinds of reports fascinating, so don't purely go on my recommendation.
Eh, government should not be in the business of maintaining digital infrastructure, regardless of how capable it might be. As much of it as possible should be contracted out to 3rd parties.
Profit motives in infrastructure are a bad idea. See Thames Water in the UK, for instance. It always introduces a perverse incentive where if the company in control of the infrastructure can extract an extra million in profit by making everything less efficient and costing everyone else involved a billion, it's still in that company's interest to do so.
This is a prime example of that. H&R Block, etc, benefit from there not being direct file by around $3bn in revenue or around $750m in profit. Rough sums on the time saved by direct file if everyone used it is 8h * average wage * taxpayers, which seems to be approximately $44bn. i.e. in axing direct file, it has "created" $3bn in economic activity to the private infrastructure-owner (the intermediary between you and filing your return), but at the cost of $44bn in lost time & therefore lost activity (the other things you could have been doing) to the rest of the economy.
Infrastructure is not the economy. Infrastructure is the thing the economy runs on top of / has to use. Given that it is the role of government to govern the economy, it is the role of government to ensure that the infrastructure is running well (be the custodian of the infrastructure).
Arguing the other side, digital infrastructure shouldn't be such a complicated domain that it is out of the reach of governments. This is the authority we trust to build our roads and virtually every other meaningful infrastructure in our civic life. Why should digital infrastructure be out of bounds?
The only alternative is inserting a third party, one that has full access to all your financial information. That shouldn't be necessary for the average filer, assuming a bare minimum of competence, like once might assume for the only country to put a human on the moon and bring them safely home.
Explain your reasoning at least.
The government has to maintain some infrastructure to get this sort of thing done. Whether digital or analog. And if it contracts it out, it needs to oversee it. So no matter how it is done, the government has to pay.
Don't you care about the actual outcome at all? Even if the government does a better job, you still prefer a third-party organization?
At exorbitant costs or lackluster execution, with plenty of campaign donations along the way
Was direct file exorbitant expensive? Or lackluster? What about all the 18F work?
On the flip side, plenty of private companies are expensive and corrupt.
I think it's possible both can be good and both can be bad.
You could just light the money on fire instead and get the same result. Contractors routinely screw the tax payer. I once had a job in one of these third parties where the entire operation was effectively defrauding the tax payer by claiming 1hr jobs would take 40.
> As much of it as possible should be contracted out to 3rd parties.
This is the case pretty much.
Do you think the government should allow electronic filing of taxes?
Because if the government is going to accept returns electronically instead of through the physical mail, then it should accept them without requiring an intermediary.
Interestingly, it does this for corporations, but not for individuals.
Gee, I wonder why.
Personally, I think that (a) the government needs to have my PII to process my taxes, and that (b) having the government require me to also hand my PII to a third party in order to pay taxes is a big fucking security nightmare.
Direct File was a service not infrastructure