IRS Reports Larger Refunds in 2026 Filing Season
The Internal Revenue Service reported that average tax refunds for the 2026 filing season are more than 10% higher compared with the same period last year. Through February 27, the agency had received about 51.5 million individual returns and processed 50.9 million, slightly fewer than the prior year. Despite the lower volume, the average refund increased to $3,742, up from $3,382 in 2025, with total refunds exceeding $136.5 billion. During a hearing before the U.S. House Committee on Ways and Means, IRS CEO Frank Bisignano attributed the increase in part to provisions in the One Big Beautiful Bill Act (OBBBA), noting that taxpayers claiming certain deductions on Schedule 1-A—such as those for qualified tips, overtime, vehicle loan interest, or the enhanced senior deduction—are seeing average refund increases of roughly $775. He also reported that direct deposit refunds are averaging about nine days, with nearly 37 million refunds issued via direct deposit so far this season.
Minnesota Issues Guidance on USPS Postmark Policy Changes
The Minnesota Department of Revenue recently issued guidance regarding changes to the United States Postal Service postmark policy that may affect the timely filing of Minnesota tax returns and payments beginning in 2026. Under the updated policy, mail will be postmarked based on the date it is first processed by USPS, rather than the date it is dropped off at a mailbox or post office. As a result, the postmark date used to determine whether a return or payment was filed on time may be one or more days later than the mailing date, potentially impacting documents sent close to filing deadlines.
To help avoid issues, the department recommends that taxpayers mail returns and payments several business days before the deadline and request a manual postmark at a USPS retail counter when submitting time-sensitive documents. Alternatively, taxpayers are encouraged to file returns and make payments electronically, which provides immediate confirmation of filing and payment dates.
IRS Provides Details on Trump Account Elections and Pilot Contributions
The Internal Revenue Service recently released proposed regulations describing how families may open and fund a Trump account, a tax-advantaged savings account created under the One Big Beautiful Bill Act (OBBBA). Under rules proposed under Internal Revenue Code Section 530A, these accounts may be established for eligible individuals under age 18 and function similarly to an IRA during a “growth period” that ends in the year the beneficiary turns 17. An account may be opened by an “authorized individual,” generally prioritized as a child’s legal guardian, parent, adult sibling, or grandparent if no higher-priority individual is available. Elections can be made using Form 4547 or through an electronic application, though contributions to Trump accounts will not be permitted before July 4, 2026.
The IRS also issued companion proposed rules explaining how eligible children may receive a one-time $1,000 pilot program contribution from the U.S. Treasury under Internal Revenue Code Section 6434. The contribution is available for U.S. citizen children born between 2025 and 2028 and must be elected by the individual who expects to claim the child as a qualifying child under Internal Revenue Code Section 152(c). The amount will be treated as a $1,000 tax overpayment for the child and deposited directly into the child’s Trump account. The proposed regulations are open for public comment, with deadlines in April and May.
Court Ruling Creates Refund Opportunity for Pandemic-Era Interest and Penalties
A recent decision by the U.S. Court of Federal Claims may create a potential refund opportunity for taxpayers who incurred interest or penalties on federal tax obligations during the COVID-19 pandemic. In Kwong v. United States (No. 23-267), the court ruled that under the prior version of Internal Revenue Code Section 7508A(d), the suspension of underpayment interest and failure-to-file or failure-to-pay penalties was mandatory for the entire federally declared COVID-19 disaster period plus 60 days—spanning January 20, 2020, through July 10, 2023. The court also determined that a Treasury regulation limiting the suspension to one year conflicted with the statute and was therefore invalid, a conclusion consistent with the earlier U.S. Tax Court decision in Abdo v. Commissioner.
As a result, taxpayers who paid interest or penalties related to tax deadlines falling within this timeframe may have the ability to file refund claims or request abatement of outstanding amounts. A November 2021 amendment to the statute does not affect the ruling because it was not retroactive. However, the federal government is expected to appeal the decision, so the final outcome may still evolve. Taxpayers who believe they may be impacted should consider reviewing their accounts to determine whether a refund or abatement opportunity exists.
IRS Releases Annual “Dirty Dozen” List, Highlights New Form 2439 Scam
The Internal Revenue Service recently released its annual “Dirty Dozen” list of tax scams for 2026, warning taxpayers about common and emerging schemes. A new item on this year’s list involves the misuse of Form 2439 (Notice to Shareholder of Undistributed Long-Term Capital Gains) to fraudulently claim tax credits. The IRS also cautioned about ongoing threats such as IRS impersonation through emails, text messages, and AI-enabled voice calls, as well as spear-phishing campaigns targeting tax professionals.
The list further highlights risks from “ghost preparers” who prepare returns but refuse to sign them and schemes promoting inflated noncash charitable contribution deductions. The IRS also warned about misleading “tax hacks” circulating on social media and identity theft attempts involving IRS Online Accounts. The agency encourages taxpayers to strengthen their cybersecurity practices and to be aware of these phishing and impersonation scams.
