IRS Faces Challenges Ahead of 2026 Tax Season

WASHINGTON (AP) — Taxpayer advocates are raising alarms about the upcoming 2026 tax filing season. Given the significant number of IRS staff departures since the Trump administration came into power, this could create hurdles for taxpayers.

Tax Advocate Erin M. Collins shared her annual report with Congress on Wednesday, just two days into the 2026 filing period. She noted that while the IRS managed to process returns smoothly in 2025, “things will look significantly different” as we approach 2026.

Collins pointed out that the IRS is contending with a 27% reduction in its workforce, changes in leadership, and complexities arising from new tax code implementations—some of which were signed into law by President Trump last summer.

While Collins believes that most taxpayers will likely be able to file their returns and retrieve refunds without much delay, she cautioned that “the success of this filing season will depend on how well the IRS assists millions of taxpayers in trouble.”

As the tax filing season kicks off on Monday, agency leaders such as Treasury Secretary Scott Bessent and IRS CEO Frank Bisignano are optimistic about achieving a successful season. Bisignano, announced last week, has mentioned that “with the creation of this new team, we are confident the IRS is ready to support Americans this tax season,” as stated in a letter to the agency’s 74,000 employees.

Bessent and other officials from Trump’s second administration have also promised taxpayers “significant tax refunds” as a response to the ongoing affordability crisis. However, other IRS oversight bodies have voiced serious concerns as the 2026 tax season begins.

Diana M. Tengesdal, Deputy Inspector General for Audit at the Treasury Department’s Tax Administration, reached out to IRS leadership on Monday about staffing issues, indicating that current staffing levels are at their lowest since October 2021. Additionally, she mentioned thousands of unprocessed tax returns and unmet communications with taxpayers.

The IRS began with around 102,000 employees in 2025, but ended up with only about 74,000 following various layoffs by the Department of Government Efficiency. While IRS officials took steps during the last tax season, many customer service representatives who worked last year have left, as they were restricted from accepting buyouts from the Trump administration until after the filing deadline passed.

Tengesdal’s office stated that despite efforts to modernize tax administration, “attempts to compensate for staff reductions may not deliver the expected results during the 2026 filing period.”

Glenn Frost, managing partner at Frost Law, commented that his firm has encountered numerous situations where taxpayers’ refund claims have been denied due to delays. “Continued IRS delays are putting real people’s lives at risk,” he remarked.

In 2025, over 165 million individual income tax returns were processed, with 94% submitted electronically. The average refund during that year was $3,167.