The Direct File tax filing program is aimed at those with simple W-2|Marco Verch|CC BY 2.0

The IRS has introduced Direct File, a free electronic system for taxpayers in 12 selected states to file their federal income taxes directly with the agency.

The online tool is aimed at those with simple W-2s, claiming standard deductions. It includes a Spanish version and a live chat feature for assistance. 

Around one-third of federal income tax returns could use Direct File, potentially benefiting 19 million taxpayers, estimates the Treasury Department.

The department says taxpayers spent an average of $150 last year on paid third-party tax prep tools like TurboTax or H&R Block Tax Software, which make around $14 billion annually.