The landscape for the 2026 tax season has its fair share of potential potholes ahead. But most taxpayers will most likely see federal income tax returns processed quickly with refunds heading out the door without delay, according to a new report to Congress.
But we're also getting a warning that everything will not be seamless.
National Taxpayer Advocate Erin Collins spelled out some challenges ahead in her 2025 Annual Report to Congress issued Wednesday, Jan. 28.
The IRS will be confronting a 27% reduction in its workforce, turnover in the agency's leadership and all the challenges of implementing complex tax law changes that went into place retroactively for 2025 after the One Big Beautiful Bill was signed into law July 4, according to the report.
Collins said the One Big Beautiful Bill Act is "generally taxpayer-favorable" because it expands eligibility for key tax deductions and benefits.
