What to Know About Tax Changes and Getting the Maximum Refund in 2026
As the 2026 tax filing season approaches with a start date of January 26, taxpayers across the United States are preparing to submit their income tax returns for the 2025 calendar year. While many aspects of filing remain familiar, several notable changes and updates are expected to impact how Americans file this year and how they can maximize their tax refunds.
Important IRS Changes and Layoffs Impacting Tax Season
One of the significant developments for the 2026 filing season is the effect of staffing changes at the Internal Revenue Service (IRS). Tens of thousands of tax workers have left the agency due to planned layoffs and buyouts implemented under Elon Musk’s Department of Government Efficiency. Experts and the IRS’ independent watchdog have warned that this reduction in personnel could lead to delays during the filing season.
Additionally, this year marks the end of paper refund checks issued by the IRS—an option many taxpayers previously used. The IRS now exclusively issues refunds through direct deposit or other electronic means. Adam Brewer, a tax attorney at AB Tax Law, recommends taxpayers who are hesitant to share existing bank details with the IRS consider opening a dedicated bank account solely for tax refunds to facilitate faster refund delivery while maintaining privacy.
IRS Free Filing Options and Electronic Filing Changes
The IRS will not offer its own “Direct File” electronic tax return system in 2026, a decision cemented by the Trump administration in December of the previous year. However, the Free File program remains available for eligible taxpayers with household adjusted gross incomes (AGI) below $84,000, allowing them to file their returns electronically at no cost through partner software providers.
Larger Refunds Expected Due to New Tax Provisions
Taxpayers can expect larger-than-usual refunds this season, largely due to provisions in the 2025 spending bill championed by the Trump administration last summer. Treasury Secretary Scott Bessent has highlighted that withholding rates had not adjusted before the passing of the bill, resulting in increased tax-withheld amounts during the year and, consequently, bigger refunds.
The IRS has flagged several key provisions that may increase deductions and therefore refunds for taxpayers who itemize, including:
- A new deduction for seniors,
- Exclusion of tax on tip income,
- Exclusion of tax on overtime pay, and
- Exclusion of tax on car loan interest.
Lisa Greene-Lewis, a CPA and tax expert at Intuit TurboTax, emphasizes professions such as beauticians and aestheticians may particularly benefit from the tip deduction, while emergency responders such as firefighters and police officers working overtime may also qualify for related tax breaks.
Important Considerations and Limitations
Despite these promising changes, tax experts caution that not every taxpayer will benefit equally. “A lot of these changes sound great, but you may not actually qualify or the savings may be limited,” said Adam Brewer. For example, the tax exclusion on tip income is capped at the first $25,000 of qualifying tip income and only applies to specific types of tips.
Moreover, taxpayers who welcomed a child in 2025 could see substantial financial benefits if they have their baby’s Social Security number ready before filing. Greene-Lewis notes that accurate Social Security numbers are necessary to claim valuable child-related deductions and credits.
Don’t Miss Out on Tax Credits
Tax credits directly reduce the amount of tax owed and can significantly increase refunds. Unfortunately, many taxpayers fail to claim them. Each year, the IRS reports that one in five taxpayers miss out on credits such as:
- The Earned Income Tax Credit (EITC), which can provide families with three children up to $8,046,
- The Retirement Savers Credit, and
- The enhanced Adoption Credit, offering up to $5,000 for eligible taxpayers.
Potential filers should also note that some credits, such as those for clean vehicle purchases and home energy improvements, expired in 2025 but might still be claimable depending on when the qualifying purchases or modifications were made.
Key Dates and Final Reminders
The official tax season opens on January 26, 2026, with the deadline for filing tax returns set for Wednesday, April 15, 2026. Due to recent IRS staffing changes and policy updates, taxpayers are encouraged to file early, use direct deposit for refunds, and carefully review eligibility for new deductions and credits to maximize their refunds.
For a full list of tax-related changes and deductions, taxpayers can consult the IRS website, which provides up-to-date guidance for the 2026 filing season.
Summary: The 2026 tax filing season brings new challenges and opportunities for taxpayers. With IRS workforce reductions and the end of paper refund checks, electronic filing and direct deposit are more important than ever. Changes in tax laws promise larger refunds for many, but it is essential for taxpayers to understand specific eligibility rules and to claim all applicable credits and deductions to receive the maximum refund possible.
This article is based on information provided by Jeremy Tanner from Nexstar Media Wire and expert insights from tax professionals.