As the 2026 tax filing season begins, apprehensions are mounting over potential difficulties taxpayers may face, particularly in light of a significant reduction in IRS personnel since the Trump administration took office. Erin M. Collins, the National Taxpayer Advocate, shared her insights in her recent annual report to Congress, where she noted the unique challenges ahead.
While the IRS effectively processed returns in 2025 without any major disruptions, Collins emphasized that the situation for the upcoming season is markedly different. She highlighted a concerning 27% reduction in workforce, a rapid turnover in leadership, and the implementation of complex tax law changes introduced by last summer’s Republican tax and spending measure signed by former President Trump.
According to Collins, the majority of taxpayers should still be able to submit their returns and receive refunds without undue delays. However, she stressed that the overall success of the filing season hinged on the IRS’s ability to assist the millions who may run into problems.
The 2026 tax season officially kicked off recently, with hope for a smooth process echoed by Treasury Secretary Scott Bessent and IRS CEO Frank Bisignano. Bisignano expressed confidence in a recent announcement concerning a reorganization of IRS leadership aimed at enhancing operational effectiveness. He reassured the agency’s 74,000 employees that a new team was in place to ensure a successful experience for taxpayers.
Additionally, Bessent and other administration officials have promised substantial tax refunds for Americans, positioning this initiative as part of their broader strategy to tackle the ongoing affordability crisis affecting many households.
However, scrutiny from watchdogs at the IRS suggests significant hurdles remain. Diana M. Tengesdal, the deputy inspector general for audit at the Treasury Inspector General for Tax Administration, shared concerns about the IRS’s staffing levels, which have reportedly reverted to figures seen in October 2021. The agency is also facing a backlog of unprocessed tax returns and taxpayer communications.
The IRS began 2025 with around 102,000 employees, but that number dwindled to approximately 74,000 due to earlier firings and layoffs driven by the Department of Government Efficiency. Notably, although IRS employees involved in the previous year’s tax season were restricted from accepting buyouts until after the filing deadline, many customer service representatives have since departed.
Tengesdal’s office cautioned that despite ongoing modernization efforts within the agency, strategies intended to mitigate staffing deficits may not deliver expected outcomes during the 2026 filing season.
In terms of numbers, the IRS processed over 165 million individual income tax returns in 2025, with an impressive 94% submitted electronically. The average refund issued was reported at $3,167, raising questions about how these figures might be affected given the current staffing and operational challenges.
