"2026 Tax Return Prep Urged as Legislative Changes Spark Refund Surge, Inflation Concerns"

The Internal Revenue Service (IRS) has issued a nationwide advisory urging taxpayers to begin preparing for the 2026 tax season, emphasizing the importance of early organization amid significant legislative changes. With the implementation of the "One Big Beautiful Bill" and associated tax law revisions, the IRS is highlighting the need for proactive measures to ensure accurate filings and timely refunds. The agency recommends that individuals start compiling financial records, reviewing personal circumstances, and updating account information to avoid delays and errors when the filing window opens in early 2026 [according to IRS guidance](https://www.masslive.com/business/2025/12/02/irs-issues-nationwide-notice-start-doing-this-before-years-end.html).

Legislative Shifts and Economic Implications

The 2026 tax season corresponds to the 2025 earnings period, with returns due by April 15, 2026. Key changes under the new legislation include the elimination of taxes on tips, overtime pay, and car loan interest, as well as expanded deductions for seniors and temporary benefits for specific demographics [according to IRS announcements](https://www.masslive.com/business/2025/12/02/irs-issues-nationwide-notice-start-doing-this-before-years-end.html). These adjustments, combined with the phaseout of paper refund checks by late 2025, necessitate updated planning strategies for filers. Analysts predict that the retroactive nature of the tax law could trigger a surge in refunds, potentially boosting consumer spending and [exerting upward pressure on inflation](https://www.usatoday.com/story/money/economy/2025/12/02/inflation-may-surge-again-tax-law-giveaways/7543202001/).

IRS Preparatory Guidance

To facilitate a smooth filing process, the IRS has outlined a pre-season checklist for taxpayers. This includes creating or accessing an IRS online account to track prior filings and tax transcripts, gathering W-2s, 1099s, and digital asset records, and confirming direct deposit details for refunds.

The agency also recommends reviewing life changes such as employment status, marital status, or home purchases that may affect deductions or credits. By leveraging e-filing tools or professional assistance, taxpayers can [expedite processing and reduce errors](https://www.masslive.com/business/2025/12/02/irs-issues-nationwide-notice-start-doing-this-before-years-end.html).

Inflationary Concerns and Fiscal Policy

Economists warn that the tax law's generous provisions may reignite inflationary pressures. David Kelly of JP Morgan Asset Management estimates that average refunds could reach $3,278 for 104 million taxpayers, with higher-income individuals likely to retain funds longer than pandemic-era stimulus recipients. This delayed spending could prolong inflationary effects, complicating the Federal Reserve's policy trajectory. While some analysts argue that slowing wage growth and core services inflation may temper price rises, others caution that the "low-pressure system" lacks sufficient demand to drive meaningful disinflation [according to economic forecasts](https://www.usatoday.com/story/money/economy/2025/12/02/inflation-may-surge-again-tax-law-giveaways/7543202001/).

Taxpayer Action Items

The IRS emphasizes the importance of maintaining organized records for deductions, charitable donations, and education or medical expenses. Taxpayers should also stay informed about evolving regulations and ensure compliance with new requirements. The agency's Get Ready portal provides resources to navigate these changes, reinforcing the need for early preparation in an environment of legislative uncertainty. [According to IRS guidance](https://www.masslive.com/business/2025/12/02/irs-issues-nationwide-notice-start-doing-this-before-years-end.html).