Former leaders of the Internal Revenue Service are issuing grave warnings regarding the agency's operational stability as the upcoming tax filing season looms. They express deep concern that persistent funding shortfalls and a continuing decline in personnel could lead to significant disruptions and inefficiencies. This pivotal period demands immediate attention to prevent a potential crisis that could adversely affect taxpayers nationwide.
Crucial Warnings from Previous Commissioners
As the 2026 tax filing season approaches, starting on January 27, the Internal Revenue Service faces a precarious situation. Former IRS Commissioner John Koskinen, speaking to the Journal of Accountancy, a publication of the AICPA & CIMA, emphasized the catastrophic implications if government funding lapses again on January 31, 2026. This date coincides precisely with the period when taxpayers begin submitting their returns, creating an unprecedented challenge for the agency.
Echoing these sentiments, Danny Werfel, who served as commissioner until early 2025, stressed the necessity for the IRS to transparently communicate to taxpayers and tax preparers about which essential services would remain operational in the event of a funding cessation. Such clarity is vital for maintaining public trust and guiding stakeholders through potential uncertainties.
The IRS successfully navigated the prior filing season, processing an impressive 144.8 million returns and exceeding its telephone service target by achieving an 85% success rate. However, the agency is now grappling with a significant loss of personnel, with approximately 25,386 employees departing in 2025 through buyouts and other means, representing over a quarter of its total workforce. This exodus, combined with the complexities introduced by the Trump administration's One Big Beautiful Bill Act, as highlighted by former acting commissioner Doug O'Donnell, threatens to overwhelm the IRS with increased demand for assistance.
Adding to the agency's woes, the vital funding from the Inflation Reduction Act, which supported operations during previous shutdowns, has been significantly curtailed by Congress, leaving only about $37.6 billion available through 2031. This reduction severely limits the IRS's financial flexibility. The National Taxpayer Advocate, Erin Collins, reported that her office faced severe backlogs after its own shutdown, with an estimated 5,000 new cases accumulating weekly. She urged patience from practitioners and taxpayers alike, underscoring the severe strain on the system.
These converging factors paint a challenging picture for the IRS, necessitating robust planning and decisive action to safeguard the integrity and efficiency of the upcoming tax filing season.
The warnings from these seasoned former IRS leaders offer a profound insight into the intricate challenges facing critical government agencies. Their collective concern underscores the delicate balance between legislative actions, funding allocations, and operational realities. This situation serves as a stark reminder that continuity and adequate resourcing are paramount for public services, especially those as fundamental as tax administration. It compels us to consider the broader implications of political gridlock on the functionality and responsiveness of government institutions, and the ultimate impact on citizens.