The American taxpayer is about to walk into a radically different landscape. The 2026 tax filing season, covering income earned in 2025, won’t just be another annual ritual of forms and receipts. It will be the first real test of the most significant structural changes to the tax code in years, changes that promise fatter refunds for some, surprising shortfalls for others, and confusion for almost everyone. This isn’t just an adjustment; it’s a reset.
For millions, the journey to a refund begins with a simple, often dreaded question: am I required to file? The baseline income thresholds have crept up again. For a single filer under 65, it’s $14,600. For married couples filing jointly, it’s $29,200.
IRS Updates: The 2026 Fiscal Year Is Set to Be Intense
But experts warn that looking only at those numbers is a costly mistake. “The biggest error we see is people who don’t file because their income was low,” says CPA Anya Sharma of ClearView Advisors. “They leave thousands on the table from refundable credits like the Earned Income Tax Credit. Filing isn’t just an obligation; for many, it’s the most significant financial benefit they get all year.”
The heart of the 2026 shift lies in the One Big Beautiful Bill Act (OBBBA). Its provisions are deliberately aimed at the middle and working class, but navigating them requires a map. The most talked-about change is the new, temporary deduction for workers aged 65 and over—a straight $6,000 reduction in taxable income.
But there’s a catch you must know beforehand: it phases out for individuals earning over $75,000. “It’s a welcome relief for fixed incomes,” notes economist David Chen, “but it’s a surgical cut, not a blanket giveaway. You need to know if you’re still in the sweet spot.”
Tipped Workers and Side Hustlers: The IRS is Changing the Rules
Perhaps the most revolutionary change targets the often-shadowy world of cash earnings. For the first time, tipped employees and those working overtime have a clear, substantial path to deducting that income. Workers can now exclude up to $25,000 in tips and $12,500 in overtime pay from their taxable income.
The goal, according to lawmakers, is to reward hard work and bring a segment of the economy into the light. But the road to a smooth refund is paved with paperwork. The mantra for 2026 is “documentation.”
The new deductions aren’t automatic. Proving tip and overtime income will require detailed pay stubs, employer statements, or personal logs. The IRS, burned by fraud in pandemic-era programs, is expected to scrutinize these claims closely. Alongside the usual W-2s and 1099s, filers claiming these benefits need a new level of record-keeping readiness.
The Tax Deadline Isn’t Just April 15 Anymore
The timeline is also shifting. While the filing season will open in late January as usual, the crucial “Where’s My Refund?” tool will tell a more complex story. Refunds that include the Earned Income Tax Credit or the Additional Child Tax Credit will, by law, be held until at least mid-February.
This perennial delay, intended for fraud prevention, creates a two-tiered system of haves and have-nots in the early weeks of the season. The absolute deadline remains April 15, but the smarter play is to file as soon as you have all your accurate documents—not before.
So What Can the Average Filer Expect in Their Bank Account?
There is no average answer. A retired couple earning $70,000 could see a refund bump of several hundred dollars from the senior deduction. A server making $50,000 with $20,000 in tips could see a dramatic reduction in their tax liability.
However, a single filer with no children and simple wages might only notice the slightly higher standard deduction. The shocking truth is that some may find their refund smaller due to the expiration of older, temporary credits and adjustments in withholding tables that happened quietly in their paychecks throughout 2025.
