Intuit TurboTax Stock Drops to $563 in 2025 as IRS Expands Free Direct Filing Program
Intuit’s shares declined after the IRS announced the permanent expansion of its free Direct File tax filing service starting in 2025, intensifying competition against TurboTax's paid and free offerings.
With over 25 years of expertise, Bill McColl has led teams in TV, radio, and digital media, delivering major news coverage as a senior producer and writer.
Highlights
- Intuit’s stock fell nearly 6% following the IRS's decision to broaden its free Direct File system for taxpayers in 2025.
- The IRS Direct File service offers taxpayers a free alternative, challenging TurboTax's market share.
- Starting with the 2025 tax season, all eligible taxpayers can use the IRS's Direct File option.
- Intuit forecasts losing up to 1 million free TurboTax users due to increased adoption of the IRS program.
Intuit (INTU) shares slipped to $562.97 after the IRS confirmed it will permanently implement its direct tax filing platform starting in 2025, a move expected to reduce demand for TurboTax software.
The IRS's decision follows a successful pilot involving over 140,000 taxpayers in 12 states during 2024, alongside positive feedback from partner analysis.
IRS Enhances Tax Filing Simplicity
IRS Commissioner Danny Werfel recommended the program’s expansion to Treasury Secretary Janet Yellen, who approved it based on strong user satisfaction and ease of filing.
Werfel emphasized the need for multiple free e-filing options, noting that Direct File aligns with the IRS’s goal to simplify tax preparation and save taxpayers time and money.
Intuit Anticipates User Decline
Intuit recently projected a loss of 1 million free TurboTax users this fiscal year due to competition from IRS Direct File, expecting a 1% overall decline in TurboTax filings and decreased revenue per user.
In April, Intuit criticized the IRS program for its limited reach, but the IRS plans to continue supporting private tax software alongside Direct File.
Since the start of 2024, Intuit’s stock has dropped nearly 10%, with Thursday’s announcement accelerating the decline.
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