The New Jersey Senate is considering a bill, A1431, that would establish an “EasyFile” program, similar to the IRS Direct File pilot at the federal level, to provide a public option for state tax filing. The goal of the proposal is to offer taxpayers a straightforward and cost-free alternative to for-profit tax preparation services. However, concerns have been raised about the potential user experience of the program being branded differently from its federal counterpart, raising questions about its ability to effectively compete with private sector solutions.
For-profit tax preparation services like TurboTax and H&R Block have set a high bar for user experience by offering seamless integration between federal and state tax filing. They provide a unified platform for handling both types of returns, which saves time, reduces confusion, and enhances user satisfaction. In comparison, government-run public option programs like Direct File and EasyFile risk creating a fragmented user experience if they operate as separate silos without a cohesive platform for sharing data between federal and state filing systems.
To ensure seamless integration between federal and state tax filing systems, both programs must adopt a collaborative approach. The Direct File program should create an application programming interface (API) that allows state tax filing systems to integrate fully with Direct File. New Jersey’s proposed EasyFile could then connect directly with the federal system and make use of data provided on federal returns, eliminating the need for duplication of data entry and creating a smooth transition from federal to state filing.
States must prioritize uniformity with the federal Direct File system rather than localized customization to avoid confusion and inefficiencies. Additionally, both systems should prioritize mobile-first design elements and accessibility to accommodate users who prefer to complete their taxes on smartphones or tablets. By developing a unified tax filing system that integrates federal and state returns, taxpayers can benefit from reduced complexity and a streamlined user experience if the platforms are thoughtfully developed and effectively implemented.
In conclusion, the success of New Jersey’s proposed EasyFile program and similar state initiatives will depend on their ability to directly integrate with the federal system and provide a seamless user experience. By emphasizing collaboration, uniformity, and mobile accessibility, these programs can offer significant benefits to taxpayers by simplifying the tax filing process and eliminating the need for navigating multiple platforms. The goal should be to mirror the efficiency and cohesion of private sector solutions while eliminating the for-profit motive and ensuring a smooth transition between federal and state filing.
