The Internal Revenue Service has announced that the 2026 tax filing season will officially begin on Monday, January 26, when the agency starts accepting 2025 federal income tax returns. This year's filing season brings sweeping changes that could significantly impact the size of your refund—and how you file.

The deadline to file returns and pay any tax owed is Wednesday, April 15, 2026. The IRS expects to process approximately 164 million individual income tax returns this year, with the agency projecting the first direct deposit refunds will arrive by mid-February for early filers.

Major New Deductions Under the One Big Beautiful Bill Act

This filing season marks the first time taxpayers can claim several new deductions enacted under the One, Big, Beautiful Bill Act. These provisions could substantially reduce taxable income for qualifying Americans:

No Tax on Tips: Service workers who receive tips can now claim a deduction for tip income, potentially saving thousands of dollars for restaurant workers, bartenders, hotel staff, and others in the hospitality industry.

No Tax on Overtime: Workers who earned overtime pay in 2025 may be eligible to deduct that income, providing relief for hourly workers who put in extra hours. This could be particularly valuable for manufacturing, healthcare, and construction workers who regularly work beyond 40-hour weeks.

Car Loan Interest Deduction: A new deduction allows taxpayers to claim interest paid on auto loans, similar to the mortgage interest deduction. This applies to vehicles purchased for personal use and could provide meaningful savings for millions of car buyers.

Enhanced Senior Deduction: Taxpayers age 65 and older may qualify for an enhanced standard deduction, providing additional tax relief for retirees on fixed incomes.

How to Claim the New Deductions

Taxpayers will use the new Schedule 1-A to claim these recently enacted deductions. The form is available through the IRS website and will be supported by major tax preparation software.

"Many taxpayers might see a higher income tax refund this year because of some of the new deductions and credits. Late changes in income tax withholding also mean that some employers withheld a little too much in 2025."

— IRS guidance for the 2026 filing season

Key Dates to Remember

  • January 9: IRS Free File opened for taxpayers earning $84,000 or less
  • January 26: IRS begins accepting tax returns
  • January 31: Deadline for employers to send W-2s and most 1099 forms
  • April 15: Tax filing and payment deadline
  • October 15: Extended filing deadline for those who file Form 4868

Paper Checks Are Being Phased Out

In a significant change, the IRS began phasing out paper tax refund checks on September 30, 2025. Most taxpayers must now provide routing and account numbers to receive their refunds via direct deposit. Those without bank accounts can use the IRS's Direct Pay option or consider opening a free checking account specifically for tax refund purposes.

Direct deposit remains the fastest way to receive your refund, with most electronic filers receiving funds within 21 days of filing. Paper returns take significantly longer—up to four weeks before refund status information becomes available.

Trump Accounts: A New Retirement Vehicle for Children

This tax season introduces Trump Accounts, a new retirement savings vehicle for children under age 18 with valid Social Security numbers. Parents, guardians, and other authorized individuals can open these accounts, which offer a pilot program contribution of $1,000 for children who are U.S. citizens born between January 1, 2025, and December 31, 2028.

Special Considerations for EITC and CTC Filers

Taxpayers claiming the Earned Income Tax Credit or Child Tax Credit should be aware that refunds will be held until late February or early March, even for early filers. This legal anti-fraud holding period applies to everyone claiming these credits, regardless of when they file.

Getting Started

To prepare for filing season:

  • Gather all W-2s, 1099s, and other income documents
  • Collect receipts for deductible expenses, especially if claiming the new Schedule 1-A deductions
  • Review last year's return for carryover items
  • Consider using IRS Free File if your income is $84,000 or less
  • Ensure your bank account information is current for direct deposit

The combination of new deductions, potential over-withholding from 2025, and the continued availability of various tax credits means many Americans could see larger refunds this year. Early filers who use direct deposit and e-file can expect their refunds by mid-February.