The 2026 tax filing season is set to commence on January 26, when the IRS begins accepting and processing 2025 tax returns. Taxpayers will have until April 15 to file their returns. However, anticipation of potential challenges looms as tax experts, including the IRS’ independent watchdog, have raised concerns about the effects of significant staffing reductions at the agency.
The IRS has seen a sharp decline in its workforce, losing tens of thousands of tax collection employees due to a combination of planned layoffs and voluntary buyouts related to initiatives from Elon Musk’s Department of Government Efficiency. The latest available data shows that the IRS workforce has dwindled from 102,113 at the end of the Biden administration to approximately 75,702. This decline has sparked worries that the agency could struggle to manage the expected tax filings effectively.
Additionally, the IRS faces the daunting task of implementing key provisions from a new tax and spending package signed into law by Republicans last summer. Many elements of this legislation have retroactive effects on the 2025 tax year, which is likely to complicate the filing process. As a result, taxpayers may experience confusion and the IRS will be required to make updates to existing tax forms.
In a statement, acting IRS Commissioner Scott Bessent emphasized the agency’s commitment to improving the tax filing experience. “President Trump is committed to the taxpayers of this country and improving upon the successful tax filing season in 2025,” he said, expressing confidence in the IRS’s ability to drive positive outcomes for businesses and consumers.
The IRS anticipates processing around 164 million individual income tax returns this season, consistent with the volume from the previous year. However, the challenges posed by a reduced workforce could hinder the agency’s performance during this critical period.
The most recent National Taxpayer Advocate report, released in June, underscored these concerns, warning that the 2026 tax season could encounter significant difficulties. Erin M. Collins, who leads the taxpayer advocacy organization, highlighted the risks associated with a decreased workforce, stating, “With the IRS workforce reduced by 26% and significant tax law changes on the horizon, there are risks to next year’s filing season.”
Compounding the situation, IRS employees involved in the previous tax season were restricted from accepting buyouts until after the April 15, 2025 filing deadline, which has further implications for staffing continuity and operational efficiency.
As the filing season approaches, both taxpayers and the IRS brace for a potentially tumultuous experience amid significant changes and staffing challenges.
