Free File tax program needs a revamp, Professor Ventry tells ProPublica

The Free File system of free online tax preparation “needs to be radically reconceived” if not eliminated, Professor Dennis J. Ventry Jr. told ProPublica, in a story co-published by Quartz.

The program established by the Internal Revenue Service and a consortium of online tax-return-preparation companies in 2003, and aimed at low- and moderate-income taxpayers, is “incredibly favorable” to the consortium’s members, Ventry said.

When it recruited those members, which include H&R Block and TurboTax maker Intuit, as conduits for the free service, the IRS promised it never would compete with them by offering its own free online preparation service.

Since then, only a fraction of potentially eligible taxpayers have used the service, partly because member sites seem do little to promote it, and partly because it is difficult to discern who qualifies to use it and who does not.

In April, the House of Representatives voted to commit the provisional program to law. The Senate is considering whether to follow suit. In the meantime, the IRS Advisory Council, which Ventry chairs, is looking into Free File and will present its recommendations in November.

Professor Ventry is an expert in tax policy and legal ethics. His research interests include tax expenditure analysis, family taxation, professional responsibility and standards of care, tax filing and administration, tax compliance, public finance, and tax and legal history. In addition, he is Chairman of the IRS Advisory Council, and co-author on the casebook, Federal Income Taxation with Martin McMahon, Jr., Daniel L. Simmons, and Bradley T. Borden.