Early Birds Can Begin Filing Taxes on Jan. 26
Warnings are mounting that the upcoming tax filing season could face turbulence, as a sharply reduced workforce and sweeping tax law changes collide. A June report from the National Taxpayer Advocate cautioned that the Internal Revenue Service may struggle in 2026 after losing more than a quarter of its employees. “With the IRS workforce reduced by 26% and significant tax law changes on the horizon, there are risks to next year’s filing season,” said Erin M. Collins, who heads the independent office charged with safeguarding taxpayers’ rights.
Despite those concerns, the IRS is pressing ahead with preparations for the new season, which officially begins on Jan. 26, when the agency starts accepting and processing 2025 tax returns. Taxpayers have until April 15 to file in order to avoid penalties and interest.
The filing season refers to the annual window in which individuals report income earned during the prior calendar year. Most U.S. citizens and permanent residents are required to file if their income exceeds certain thresholds set by law.
Agency leaders say systems and staff are ready. IRS Chief Executive Officer Frank Bisignano, appointed to the newly created role in October, sought to reassure the public. “The IRS workforce remains vigilant and dedicated to their mission to serve the American taxpaying public.
At the same time, IRS information systems have been updated to incorporate the new tax laws and are ready to efficiently and effectively process taxpayer returns during the filing season.” Bisignano also serves as commissioner of the Social Security Administration.
The IRS will also be tasked with carrying out major elements of Republicans’ tax and spending package enacted last summer. Several of those provisions apply retroactively to the 2025 tax year, a shift expected to generate confusion among filers and force updates to tax forms and guidance.
Acting IRS Commissioner Scott Bessent echoed confidence in the agency’s ability to handle the workload while tying the effort to broader economic goals. “President Trump is committed to the taxpayers of this country and improving upon the successful tax filing season in 2025,” Bessent said in a statement. “I am confident in our ability to deliver results and drive growth for businesses and consumers alike.”
The IRS anticipates receiving about 164 million individual income tax returns this year, roughly in line with last year’s volume. According to agency data, the average refund last season came to $3,167, and Bessent has repeatedly said provisions in the Republican tax law are expected to translate into larger refunds in 2026.
Still, staffing levels remain a major point of concern. The National Taxpayer Advocate’s report to Congress noted that the IRS workforce shrank from 102,113 employees at the end of the Biden administration to 75,702. The agency’s website has not yet been updated to reflect current employment figures.
Adding to the strain, IRS employees who worked during last year’s filing season were barred from accepting buyout offers from the Trump administration until after the April 15, 2025 deadline, delaying departures but not preventing the eventual loss of personnel.
Tax experts, including the IRS’s own watchdog, have warned that the combination of tens of thousands of departures tied to layoffs and buyouts — driven by Elon Musk’s Department of Government Efficiency — along with complex new tax rules, could make the 2026 filing season more challenging than usual.
{Matzav.com}
