IRS faces challenges in 2026 tax season due to workforce reductions and new laws: Watchdog

IRS faces challenges in 2026 tax season due to workforce reductions and new laws: Watchdog
IRS faces challenges in 2026 tax season due to workforce reductions and new laws: Watchdog

Washington– The national taxpayer advocate warns against this 2026 tax filing season It will likely pose a challenge for taxpayers having trouble filing their taxes given the exodus of IRS employees since the beginning of the Trump administration.

National Taxpayer Advocate Erin M. Collins released her annual report to Congress on Wednesday, two days after the start of the 2026 season. Find out while IRS It was able to handle returns in 2025 without major disruptions, “going into 2026, the landscape is noticeably different.”

“The IRS simultaneously faces a 27% reduction in its workforce, a change in leadership, and the implementation of broad and complex changes to the tax code.” Commissioned by Republican measure of taxes and spending Collins said in her report that President Donald Trump signed the law last summer.

Collins says most taxpayers should be able to file their returns and receive their refunds without delay, but she notes that “the success of the filing season will be determined by how well the IRS is able to help millions of taxpayers in trouble.”

Tax filing season began Monday, with agency leaders including Treasurer Scott Besent and IRS CEO Frank BisignanoThey said they expect a smooth season.

Bisignano announced last week New priorities and reorganization from IRS executive leadership in a letter to the agency’s 74,000 employees, saying he was “confident that with this new team in place, the IRS is well-prepared to deliver a successful tax filing season to the American public.”

Besant and others in the second Trump administration also promised American taxpayers a “big tax refund,” as part of the Republican administration’s solution to the ongoing affordability crisis.

However, other IRS watchdogs have identified significant concerns at the start of the 2026 tax season.

Diana M. Tingsdahl, deputy inspector general for auditing at the Treasury Inspector General for Tax Administration, wrote a letter to IRS leadership on Monday and cited IRS staffing at October 2021 levels, along with thousands of unprocessed tax returns and taxpayer correspondence.

The IRS started 2025 with about 102,000 employees and ended with about 74,000 after a series of firings and layoffs brought on by the Department of State Efficiency. While last year, IRS employees participated in 2025 tax season They were not allowed to accept the takeover offer from the Trump administration until after the taxpayer filing deadline, and several customer service workers have left this year.

Despite new efforts to modernize tax administration, “initiatives to offset employment losses may not achieve the expected benefits during the 2026 filing season,” Tingsdal’s office says.

More than 165 million individual income tax returns were processed in 2025, with 94% filed electronically. The average refund was $3,167.

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Follow AP’s IRS coverage on https://apnews.com/hub/internal-revenue-service.

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