The Internal Revenue Service had a largely successful tax-filing season, National Taxpayer Advocate Erin Collins
This past tax season, the IRS processed nearly 139 million individual tax returns, issued over 90 million refunds, and successfully implemented a number of tax law changes from the One Big Beautiful Bill Act but nevertheless faced major operational challenges. The report pointed to areas where taxpayers experienced refund delays and service challenges, including tax returns that were suspended during processing for extra review, delays in receiving paper refund checks and prolonged case resolution times for identity theft victims. The report also includes Collins' main recommendations as the IRS continues to update its technology.
"Entering the 2026 filing season, there was considerable uncertainty about the IRS's ability to successfully manage a convergence of major challenges: implementation of sweeping new tax legislation, significant workforce reductions, and extensive leadership turnover," Collins wrote. "In the end, the IRS performed better than expected in most respects. The vast majority of taxpayers filed their returns successfully and received their refunds without significant delay. [But] taxpayers who required assistance from the IRS often struggled to get it."
She credited the IRS's continuing technology transformation efforts as a main driver of its success. Around 98% of tax returns were submitted electronically this year, about 65% of those returns resulted in refunds, and approximately 98% of refunds were delivered by direct deposit.
On the other hand, over 14 million individual income tax returns were suspended during processing, and more than 1 million taxpayers did not receive their refunds within the IRS's normal processing time, leading to an average wait of about 5.5 weeks.
Paper checks and tax refund delays
This past filing season, the IRS implemented an
Collins noted that some taxpayers cannot receive their refunds by direct deposit, including unbanked and underbanked taxpayers, lower-income taxpayers, certain elderly taxpayers, taxpayers residing overseas, and other taxpayers for whom electronic payment was not practical or accessible. The executive order expressly authorized the Treasury Secretary "to revise procedures for granting limited exceptions where electronic payment and collection methods are not feasible," but the report said the IRS did not establish clear and workable procedures for millions of affected taxpayers, creating confusion, additional work for taxpayers and the IRS alike, and refund delays of 6 weeks or more.
As of April 27, the IRS had issued about 4 million notices for returns that either didn't include valid direct deposit information or contained incorrect information. The notices instructed taxpayers to log onto their online accounts to provide or correct their direct deposit information, or to request a waiver to receive a paper check. However, most taxpayers do not have online accounts, and some could not establish them. Even for taxpayers who did have online accounts, the notice left out crucial information that taxpayers needed to make a waiver request. As an alternative, the IRS allowed taxpayers to call the IRS's 1040 telephone line to request a waiver, but neglected to mention that option in its notice.
While most taxpayers didn't encounter problems this past tax season, the report said the "aggregate statistics do not tell the whole story."
"For millions of taxpayers, the filing season was frustrating, confusing, and financially disruptive," the report added. "Some taxpayers whose returns were frozen by IRS filters waited weeks or months for refunds they depended on to pay rent, buy groceries, or cover medical expenses. Taxpayers calling certain IRS telephone lines often could not reach a live employee despite repeated attempts. Victims of identity theft continued to face unacceptable delays that, in many cases, stretched close to two years. Lower-income and unbanked taxpayers seeking paper refund checks encountered obstacles and delays that left many feeling shut out of a system that should work for everyone."
The report noted continuing delays of about 20 months to resolve identity theft victim assistance cases. For the past three years, the Taxpayer Advocate Service has reported on "unconscionable" IRS delays in resolving identity theft cases, which often require taxpayers to wait nearly two years to receive their refunds. At the end of the filing season, more than half a million cases were pending in inventory.
"For many low- and middle-income taxpayers, waiting nearly two years for a refund is not merely an inconvenience [but a financial hardship]," the report said. "For all taxpayers, this delay is frustrating, burdensome, difficult to navigate, and time-consuming."
Phone lines and levels of service
Taxpayers had a harder time reaching the IRS by phone this past filing season than last year. Overall, the IRS received 48.1 million calls, telephone assistors answered 9.9 million calls (21%), and the average time taxpayers spent waiting on hold was 14 minutes. Comparatively, during the prior filing season, 50.2 million calls were received, 12.4 million calls were answered by telephone assistors (25%), and the average wait time was 8 minutes.
Historically, the IRS has measured its telephone performance based only on calls to its Accounts Management telephone lines and has used a "level of service" measure that excludes calls to other phone lines, calls routed for automated responses, and calls in which the taxpayer hangs up before being placed in a calling queue. This year, the IRS provided a 73% level of service on the Accounts Management lines, and wait times on those lines averaged eight minutes.
But two of the three highest volume telephone lines don't fall under the Accounts Management umbrella, Collins noted, and taxpayers calling those lines encountered considerable difficulty getting help. About 3.4 million calls were received on the Installment Agreement/Balance Due line, which taxpayers call when they cannot fully pay their tax liabilities and want to set up installment agreements or make other payment arrangements.
The IRS only answered 31% of those calls, and taxpayers waited an average of 45 minutes for a telephone assistor to answer them. In addition, about 2.4 million calls came in through the Taxpayer Protection Program line, which taxpayers call when their returns are suspended during processing due to suspected identity theft and they need to authenticate their identities to secure the release of their refunds. The IRS only answered 19% of these calls, and taxpayers waited an average of 20 minutes to get through to representatives.
Online accounts
Continued improvements in online accounts offered valuable self-service options for taxpayers. Taxpayers logged into their Individual Online Accounts nearly 121 million times during the filing season while the IRS expanded account functionality to allow taxpayers to upload documents in response to certain notices, receive refund status notifications, update direct deposit information in some circumstances and access additional account information. Taxpayers used their online accounts to view the tax documents they needed to prepare accurate returns, accessing information returns more than 3.7 million times.
Taxpayers also made extensive use of the IRS's refund-tracking tools. During the filing season, taxpayers checked the status of their refunds through the IRS's Where's My Refund? tool about 346 million times, a 9% increase from the prior year. The report says online accounts and refund-tracking tools give taxpayers access to information when they need it and reduce the need to call the IRS or visit a Taxpayer Assistance Center.
"The IRS is often held up as the poster child for antiquated government technology infrastructure, and there is certainly some truth to that characterization," said the report. "But the IRS has been improving its technology year by year, and as long as it gets the IT right, most taxpayers file their returns and receive their refunds without delay."
In the preface to the report, Collins said the 2026 filing season highlights a growing divide in tax administration between taxpayers whose issues can be resolved through automated systems and taxpayers whose situations need individualized assistance, manual review or flexibility.
"Taxpayers who fall outside standard processing channels are often the taxpayers who most need assistance, [often] because they are elderly, disabled, limited-English proficient, unbanked, or lacking reliable internet access," Collins wrote.
"[A] digital-first strategy can improve tax administration but must not become a digital-only strategy," she continued. "As the IRS continues to transform its operations, it must preserve meaningful access to telephone assistance, in-person service, clear notices, timely correspondence, and effective case resolution functions. Taxpayers must be able to understand what is expected of them, obtain help when they need it, and trust they will be treated fairly when problems arise. Those principles are fundamental to taxpayer rights and essential to maintaining public confidence in our tax system."
Key objectives
The Taxpayer Advocate Service's midyear report also functions as an objectives report and includes 11 key advocacy objectives for the upcoming fiscal year, as required under law:
- Protect taxpayer rights to refunds if a recent U.S. Court of Federal Claims decision is affirmed on appeal in the case of Kwong v. United States, where the court held that filing and payment deadlines were suspended during the three-and-a-half-yearlong COVID-19 disaster period and therefore that the IRS should not have assessed penalties for late tax filings and payments;
- Substantially reduce delays in resolving the cases of identity theft victims;
- Reduce burden and delays for taxpayers who are unable to receive their refunds via direct deposit and require paper checks;
- Make it easier for taxpayers to comply with digital asset reporting requirements;
- Improve the clarity of math error notices and abatement procedures, as required by Public Law No. 119-39, the Internal Revenue Service Math and Taxpayer Help Act, a 2025 law based on a prior National Taxpayer Advocate legislative recommendation;
- Improve the process for extending the refund statute of limitations when a taxpayer is waiting for the IRS to decide on a request for reconsideration or an appeal of an adverse audit determination;
- Improve online Tax Pro accounts to make it easier for practitioners to communicate with the IRS, and thereby reduce taxpayer burden and costs;
- Reduce refund delays and improve communication when the IRS suspends a tax return during processing, temporarily freezing delivery of the requested refund;
- Ensure tax penalties are fairly and consistently applied, taking into account that millions of penalties the IRS assesses each year are later abated upon taxpayer request;
- Improve the process by which the IRS records taxpayer power-of-attorney designations, so designated practitioners can begin to represent taxpayers before the IRS without unreasonable delays; and,
- Reduce delays in the processing of tax returns filed by or on behalf of deceased taxpayers, so families may obtain closure without unreasonable delays.
The IRS has already agreed to implement most administrative recommendations proposed in the National Taxpayer Advocate's
