The 2026 tax season continues to unfold under unusual circumstances. In addition to multiple states facing issues that might delay refunds, the IRS is dealing with issues that could further hinder the process. According to the IRS, the entity responsible for processing federal tax returns is operating with significantly fewer employees than last year, down roughly 27%.

While many taxpayers may still receive refunds on time, the reduced workforce is raising concerns about delays, slower processing, and limited customer support. Combined with new tax law changes, this could make filing season more complicated than usual. Learn more about what’s behind the staffing cut and how it could impact your tax return as deadline day draws closer.

A 27% Workforce Drop Is Straining the System

Concerns about federal income tax refund delays in 2026 are directly linked to the decline in staffing faced by the agency. At the beginning of 2025, the IRS had 102,000 employees, but by January 2026, there were only 74,000 employees. The Online Services department was hit the hardest, after losing 100% of its employees when the department was phased out. Direct Filing came in at a close second, having lost 88% of its employees before the new year started.

Other departments that faced severe losses included the Small Business/Self-Employment Department, which lost 37% of its staff, Taxpayer Services, which was reduced by 21%, and the IT department, which lost a quarter of its staff. With fewer employees available to handle incoming returns and inquiries, the agency is under increased pressure during one of its busiest times of the year.

Refund Delays Are More Likely for Certain Filers

Based on historical averages, Americans with straightforward income tax returns filed online generally receive a refund within 21 days of filing. Perhaps the lone piece of good news among the current staffing crisis is that this figure is unlikely to change. However, for taxpayers who utilize paper forms and those who have more complex returns, the IRS staffing cuts pose a serious problem. Experts warn that even standard, online returns that contain errors could take far longer than normal to process due to the lack of available staff members.

New Tax Law Changes Add Another Layer of Complexity

Changes to the federal tax law add another layer of complication to an already tedious process. These changes increase the likelihood of filing errors and taxpayer questions, both of which require IRS resources to resolve. Historically, major tax law updates have led to more returns being flagged for review, which can slow down refunds even in well-staffed years.

2026 certainly isn’t the first year that the tax code has changed. However, the lack of staffers who can work with taxpayers to resolve issues in a timely manner has never decreased so rapidly.

Customer Service May Be Harder to Access

The IRS reports an average of 100 million customer phone calls each year, with the bulk of those calls coming in the weeks directly before and after the April 15 deadline. With so many departments facing cutbacks, including the customer service department, IRS customer service issues are expected to reach an all-time high.

This lack of available staff could potentially create a bottleneck in the process, especially when the typical influx of returns starts rolling in. Even if the system functions relatively smoothly at first, pressure is expected to build as the filing deadline approaches, placing even more strain on a department that’s been dealing with cutbacks and voluntary resignations for most of the last year.

Why Filing Method Matters More Than Ever

In a year where tax refund delays are expected at both the state and federal levels, the way that you file your taxes matters more than ever. Electronic filing remains the fastest and most reliable option, especially when combined with direct deposit for refunds. Paper returns, on the other hand, require manual processing and are far more likely to be delayed.

Accuracy is also more important than it has ever been. Even minor mistakes, such as an incorrect number in your contact information or a missing form, could potentially delay your refund by weeks or longer.

While there’s certainly nothing that the average taxpayer can do to resolve the staffing issues, there are steps that you can take to reduce the likelihood of delays. Filing early, double-checking all information, and filing online are the most effective steps that you can take to protect yourself from issues caused by tax filing delays in 2026.

Looking for stories that inform and engage? From breaking headlines to fresh perspectives, WaveNewsToday has more to explore.