The "Direct File Act of 2026" seeks to codify the Direct File program by amending the Internal Revenue Code of 1986. A central provision of the bill is the prohibition on the Secretary of the Treasury from entering into any agreement that restricts the Internal Revenue Service's (IRS) ability to provide tax return preparation or filing services, and it explicitly voids any such existing agreements within 30 days of enactment. The legislation mandates the establishment and operation of a free, government-owned online program for taxpayers to prepare and file individual income tax returns. This program is designed to be user-friendly, utilizing IRS data for simplification, employing an interview-based system, and being accessible in multiple languages and on mobile devices, while also conforming to Section 508 accessibility guidelines. Key features of the program include its prominent display on the IRS website, a comprehensive mass marketing campaign, and the provision of integrated customer support, including live chat services. For taxable years beginning after 2027, the program must be available to at least 50 percent of taxpayers in participating states , with continuous expansion of eligibility. Participating states are defined as those that either elect to provide integrated state tax return filing functionality or do not impose a state income tax. The Secretary is required to enable seamless filing of state or local income tax returns in conjunction with federal returns for these states, potentially through data sharing and a grant program to support state integration. The bill also requires the Secretary to submit annual reports to Congress on the program's usage, taxpayer satisfaction, and barriers to use. While establishing this program, the legislation clarifies that it does not absolve taxpayers of their full responsibility for the accuracy and completeness of their tax returns. Appropriations are authorized for fiscal years 2026 through 2035, and the amendments apply to returns for taxable years beginning after December 31, 2025.