Tag: Tax and IRS News

Issue Number: Tax Tip 2026-36

It’s not too early to start planning for next year: Check withholding now

Even though the tax filing deadline for tax year 2025 passed a couple weeks ago, it’s not too early to start planning for next filing season. Planning now can help taxpayers avoid surprises next year. One action that can be taken is checking for proper tax withholding.

What is withholding?
Taxpayers need to pay their tax as they receive their income, and they do this through withholding. For employees, “withholding” refers to the federal income tax portion of each paycheck that an employer takes out for tax purposes. It can also be the amount from earnings self-employed people and others voluntarily set aside to pay their estimated taxes.

How taxpayers can check their withholding
The IRS Tax Withholding Estimator is a free, easy-to-use tool that helps workers and retirees estimate the amount of federal income tax to withhold from their paychecks now for the taxes they will owe next year.

The estimator reflects the changes to credits and deductions under the One, Big, Beautiful Bill. This includes the deductions for tips, overtime, car loan interest and enhanced deduction for seniors. It also accounts for updates tied to family-related credits, homeownership, and charitable giving.

What are the benefits of using the IRS Tax Withholding Estimator?
By using the estimator, taxpayers can manage their estimates based on any personal life change, such as buying a home, changing jobs, having a child or changing their marital status.

For people who recently completed their 2025 tax return, the IRS advises using the IRS Tax Withholding Estimator to consider all income sources such as full-time wages, side jobs and any sale of services or goods.

By adjusting tax withholding, taxpayers can:

• Prevent owing money and potential penalties at tax time
• Adjust withholding to increase take-home pay instead of waiting for a refund

What else taxpayers need
For an effective tax withholding estimate, taxpayers will need certain documents including:

• All income statements, including their spouse’s if filing jointly
• Data from other sources of earnings
• Their most recent income tax return

More information

• Publication 505, Tax Withholding and Estimated Tax
• Tax Withholding Estimator FAQs

Subscribe to IRS Tax Tips

Back to top

Issue Number:  IR-2026-59

Inside This Issue

Treasury, IRS provide guidance on a new method for recovering federal excise tax paid on dyed fuel established under the One, Big, Beautiful Bill

IR-2026-59, April 30, 2026

WASHINGTON — The Department of the Treasury and the Internal Revenue Service today issued temporary regulations and the accompanying notice of proposed rulemaking on a new method for recovering federal excise tax paid on dyed fuel established under the One, Big, Beautiful Bill.

These temporary regulations provide the procedures by which a taxpayer may recover federal excise taxes paid on clear diesel fuel or kerosene if that taxpayer later removed the fuel from a terminal as dyed fuel for nontaxable use. They also limit the claimants to taxpayers that paid to the IRS the original tax on the dyed fuel to which the claim relates.

Submitting a dyed fuel refund claim

The temporary regulations provide guidance to determine eligibility and rules for filing a claim for a dyed fuel refund. Taxpayers who paid tax on diesel fuel or kerosene and later removed the fuel from a terminal as eligible dyed fuel on or after Dec. 31, 2025, can submit a claim for refund, provided the following requirements are met:

1. The dyed fuel was previously taxed, and the tax was not credited or refunded.
2. The fuel is indelibly dyed by mechanical injection and removed from an approved terminal for a nontaxable use on or after Dec. 31, 2025.
3. The claimant must be the taxpayer that paid the prior fuel excise tax imposed on such fuel.
4. The claimant meets the reporting requirements as described in today’s guidance.
5. The claimant uses updated Form 8849, Claim for Refund of Excise Taxes and Schedule 5 (Form 8849), Section 4081(e) and 6435 Claims, including all information and documentation required by the forms and form instructions.
6. The claimant follows all other procedures listed in the guidance.   

Treasury and IRS recognize the importance of providing clarity to taxpayers through guidance that can be relied on to file claims and structure business arrangements as soon as possible. To enable this, the temporary regulations are effective immediately. They will expire no later than 3 years from today’s effective date and will be replaced with permanent regulations. Treasury and IRS also note that absent a statutory change, they currently lack the authority to pay the claims to anyone other than the person that paid the prior fuel excise tax to the IRS.   

Treasury and IRS welcome public comments

The notice of proposed rulemaking invites comments and requests for a public hearing on the proposed regulations.

For more information, see One, Big, Beautiful Bill Provisions on IRS.gov.

Back to Top

Issue Number: Tax Tip 2026-35

When and how to amend a tax return

Taxpayers who discover an error after filing a federal tax return may need to file an amended return. There are some instances where an amended return isn’t required such as when the IRS corrects errors during processing or requests missing forms or schedules separately.

Reasons to file an amended return
If there are changes to key items on the original return, including:

• Filing status
• Income
• Deductions
• Credits
• Dependents
• Tax liability

Taxpayers can use the Should I file an amended return? tool within the IRS Interactive Tax Assistant to help decide if they should file an amended return to correct an error or make other changes if they already filed.

Time limits
To claim a refund, an amended return must generally be filed within:

• Three years from the date the original return was filed, or
• Two years from the date the tax was paid, whichever is later

If the original return was filed early, the three-year period begins from the April tax deadline. Special rules apply when there are net operating losses, foreign tax credits, bad debts or other issues. Additionally, taxpayers in disaster relief situations, combat zone service, have bad debts, foreign tax credits, or loss or credit carrybacks, may have more time to file an amended return.

How to file an amended return
Taxpayers must file Form 1040-X, Amended U.S. Individual Income Tax Return. When filing, they should:

• Submit a corrected Form 1040, 1040-SR, or 1040-NR for the applicable tax year
• Attach any supporting documents and updated forms or schedules

Refunds and payments
For tax years 2021 and later, taxpayers may request direct deposit of refunds when filing electronically. If additional tax is owed, payment should be submitted with the amended return. The amended return replaces the original return, and the IRS will calculate any applicable penalties or interest if filed after the due date.

Status of amended return
Taxpayers can check the status of an amended return approximately three weeks after it’s submitted. It generally takes 8 to 12 weeks for it to be processed. However, in some cases, processing could take up to 16 weeks.

State tax considerations
Changes to a federal return may affect a taxpayer’s state tax liability. Taxpayers should contact their state tax agency for guidance and should not attach state returns to the federal amended return.

More information

• Instructions for Form 1040-X
• Amended return frequently asked questions

Subscribe to IRS Tax Tips

Back to top

Issue Number:  IR-2026-58

Inside This Issue

IRS announces new option for certain taxpayers to request more time after ERC claim disallowance

IR-2026-58, April 27, 2026

WASHINGTON — The Internal Revenue Service today announced a new, streamlined way for taxpayers to extend the period of time for the IRS and the IRS Independent Office of Appeals to review a taxpayer’s response to a disallowance of an Employee Retention Credit (ERC) claim to avoid refund litigation.

When an ERC claim is disallowed by the IRS, taxpayers receive a Letter 105-C or 106-C. These affected taxpayers generally have two years from the date of that letter to resolve their claim administratively or to file a refund suit in Federal court if they disagree with the IRS’s decision. Taxpayers may protest the IRS’s disallowance with the IRS Independent Office of Appeals, but that does not extend this statutory two-year deadline.

After the two-year period ends, the IRS cannot issue a refund, even if it later decides in the taxpayer’s favor after reviewing the disallowance. The deadline varies depending on the date of the original 105-C or 106-C letter.

The IRS is aware that some taxpayers are approaching the end of this two-year period and is providing a new way for taxpayers to request more time to resolve their claims administratively or to file suit through the filing of Form 907, Agreement to Extend the Time to Bring Suit, if they meet both of the following conditions:

• The taxpayer is waiting for the IRS to consider their response to the notice of disallowance on Letter 105-C or 106-C, and
• The taxpayer has six months or less remaining before their two-year period expires.

Requesting more time to file suit or resolve claim administratively

Under current law, the IRS and a taxpayer can agree in writing to extend the time to file suit, if both parties sign Form 907 before the two-year period expires. A fully executed Form 907 gives the IRS more time to consider the disallowance administratively and gives the taxpayer more time to file suit, if needed.

Starting today, taxpayers with six months or less remaining in their time to file suit, and who are waiting for the IRS to consider their disallowance response to Letter 105-C or 106-C, may submit Form 907 requesting an extension via the IRS Document Upload Tool by going to IRS.gov/DUTReply and selecting notice ‘CP320B’ from the drop-down menu. Properly executed Forms 907 will be given due consideration by the IRS, and taxpayers will be informed in writing whether the IRS has agreed to the extension. Countersigned Forms 907 will be sent to taxpayers or their authorized representative. The IRS will not consider, as part of this tool, Forms 907 submitted for disallowances unrelated to Letters 105-C or 106-C, and taxpayers should submit these requests through the IRS’s normal processes.

The IRS is sending Notice CP320B to taxpayers identified as eligible for this new Form 907 submission method. Step-by-step instructions are available at IRS.gov/CP320B.

Taxpayers may be eligible to extend the time even if they don’t receive Notice CP320B. Step-by-step instructions are available at IRS.gov/erc105c and IRS.gov/erc106c for those who believe they meet the above-stated criteria, even if they did not receive a letter.

Taxpayers who received an ERC claim disallowance notice and are unsure of their deadline should review the information provided on IRS.gov: Understanding Letter 105-C, Disallowance of the Employee Retention Credit or Letter 106-C, Claim Partially Disallowed. Those with additional questions should call the phone number listed on their most recent IRS notice.

The IRS will continue processing ERC claims and appeals in accordance with its established procedures. This new streamlined process is intended to provide taxpayers with clear, timely information about their rights and available options, and thereby observing taxpayers’ rights.

Back to Top

Issue Number:  IR-2026-57

Inside This Issue

Taxpayer Advocacy Panel issues 2025 Annual Report highlighting taxpayer-focused recommendations to improve tax administration

IR-2026-57, April 24, 2026

WASHINGTON — The Taxpayer Advocacy Panel today released its 2025 Annual Report highlighting accomplishments and ongoing efforts to strengthen Internal Revenue Service delivery, improve communications with taxpayers, reduce taxpayer burden, and support continued modernization of tax administration.

“In 2025, TAP members dedicated hundreds of volunteer hours to grassroots outreach, listening directly to taxpayers across the country and abroad and elevating the real-world challenges they face,” said National Taxpayer Advocate Erin M. Collins. “Their efforts resulted in nearly 200 recommendations to improve IRS service and tax administration. By partnering with the IRS to advance practical, taxpayer-focused solutions, TAP plays a critical role in strengthening taxpayer rights and making tax administration more transparent, accessible, and responsive. I extend my sincere appreciation to our TAP volunteers for their exceptional commitment and the meaningful impact reflected in this Annual Report.”

In 2025, the TAP project committees submitted 20 project referrals to the IRS, including 188 recommendations aimed at improving IRS operations and enhancing the experience for taxpayers nationwide.

Key recommendations outlined in the report

The six principal project committees presented a series of recommendations to the IRS that include:

• Making taxpayer notices clear, accessible, and easier for taxpayers to understand and act on.
• Enhancing IRS online tools and digital services to expand secure self-service options for taxpayers and improve the user experience within the IRS Online Account and tax transcript applications.
• Streamlining IRS correspondence processes and strengthening Individual Taxpayer Identification Number online tools to reduce processing delays, minimize call volume, and improve response times.
• Improving the clarity of IRS tax forms and publications, including recommending updated guidance on Form 8821, Tax Information Authorization, regarding disclosure authority and revocation procedures.
• Reinforcing the importance of in-person assistance to ensure taxpayers continue to have access to essential support services.
• Reducing wait times on IRS toll-free telephone lines by expanding secure chatbot and live chat capabilities to provide timely, personalized, and accessible customer service.

The report also recognizes the outgoing and incoming National TAP Chairs for their dedicated service and leadership:

• Michelle Brookens – 2025 National TAP Chair
• Philip Hwang – 2026 National TAP Chair

Historically, TAP’s recommendations have contributed to meaningful improvements in IRS processes, forms, notices, and procedures that directly affect taxpayers. The panel anticipates that the 2025 recommendations will similarly support enhancements to taxpayer service and tax administration.

The full 2025 TAP Annual Report is available to download on ImproveIRS.org.

About TAP

TAP is a Federal Advisory Committee that provides citizens with a unique opportunity to take part in the federal tax administration system. TAP members comprise citizen volunteers from across the country, and  an international member. These volunteers represent the broad geographic and varied demographic backgrounds of the U.S. taxpayer population they serve. As everyday taxpayers, TAP members provide an independent, grassroots perspective on IRS services and procedures, offering insights that complement, but are distinct from, those of tax professionals and industry organizations.

Oversight and program support for TAP is provided by the Taxpayer Advocate Service, an independent organization within the IRS led by the National Taxpayer Advocate. TAS helps taxpayers with tax problems they cannot resolve with the IRS and makes administrative and legislative recommendations to mitigate systemic problems in tax administration.

For additional information about TAP:

• Visit ImproveIRS.org or
• Email TAP staff at taxpayer.advocacy.panel@irs.gov.  

For media inquiries, contact TAS Media Relations at TAS.media@irs.gov or call 202-317-6802.

Back to Top