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TaxBuzz Top 5 - IRS Confirms Leadership Shake-Up as Tax Season Starts, Alaska Calls For Seasonal Taxation & More

by
Rebekah Barton
on
1/23/2026
TaxBuzz Top 5 - IRS Confirms Leadership Shake-Up as Tax Season Starts, Alaska Calls For Seasonal Taxation & More

Each Friday, TaxBuzz brings you the top five tax and accounting headlines you need to know from the workweek. We know life can get busy and you don't always have time to scroll through your news feed to stay informed.

We weed through all of the week's stories to showcase the most important updates in the tax and accounting world.

1. IRS Announces Leadership Shake-Up And Preparations Ahead Of 2026 Tax Filing Season

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Credit: Skyhobo/Getty Images

With the 2026 tax filing season kicking off on Jan. 26, the Internal Revenue Service (IRS) and the U.S. Treasury are rolling out preparations, personnel changes, and taxpayer guidance designed to manage a complex season ahead. The agency faces the task of processing an estimated 164 million federal income tax returns while implementing major provisions from the One Big Beautiful Bill Act and other law changes.

IRS Chief Executive Officer Frank Bisignano announced a significant reorganization of senior leadership just days before the season begins, aimed at modernizing operations and improving service. The overhaul includes bringing in new leaders across Criminal Investigation and internal consulting roles, as well as a unified focus on tax compliance and customer support ahead of the filing surge.

Taxpayers should be aware of several practical shifts for 2026: the IRS is encouraging early preparation using updated guidance and online tax accounts, direct deposit for refunds, and review of new deductions and credits tied to recently passed federal tax law changes.

However, staffing cuts over the past year have raised concerns among lawmakers and watchdogs about the agency’s capacity to deliver smooth service. A bipartisan group of senators warned that workforce reductions and turnover could hamper processing, customer support and refund timelines at peak filing time.

Taxpayers can also take advantage of Free File and other IRS-supported preparation options to lower costs, though the discontinued IRS Direct File system will not be offered for this season.

Key Dates & Tips:

  • Jan. 26, 2026: Filing season opens.
  • April 15, 2026: Tax Day for most individual returns.
  • Start gathering W-2s, 1099s, and documentation now to avoid errors and refund delays.

2. Mamdani Continues Calls to Tax The Rich in New York City

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Credit: Andres Kudacki/Getty Images

New York City Mayor Zohran Mamdani renewed his push to raise taxes on the city’s wealthiest residents and corporations as state budget negotiations ramp up in Albany. Mamdani argues that New York City sends a disproportionate share of revenue to the state while facing mounting costs tied to housing, transit, and public services.

The proposal puts him at odds with Gov. Kathy Hochul, who has said she does not support broad tax increases in the current budget. Mamdani said city officials will continue pressing lawmakers to reconsider revenue options as fiscal pressures grow.

Mamdani framed the tax debate as a question of fairness, saying the city cannot continue absorbing rising costs without additional state support or new revenue streams. He emphasized that higher earners and large corporations should shoulder more of the burden.

Alongside his tax comments, Mamdani highlighted new consumer protection rules banning hidden hotel “junk fees” and unexpected credit card holds. City officials say the changes stem from hundreds of consumer complaints and are expected to save travelers millions of dollars annually.

3. Alaska Governor Floats Seasonal Statewide Sales Tax Amid Budget Pressure

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Credit: Blue Poppy/Getty Images

Alaska Gov. Mike Dunleavy is proposing a temporary, seasonal statewide sales tax as part of a broader effort to stabilize the state’s finances. Alaska is one of the few states without a statewide sales tax, making the proposal a notable shift in long-standing fiscal policy.

Dunleavy said the tax would apply only during certain parts of the year, though specifics on the rate, timing, and possible exemptions have not yet been released. The proposal is expected to be introduced formally during the current legislative session.

The governor framed the idea as a response to ongoing budget challenges tied to volatile oil revenues and structural deficits. Lawmakers are facing a projected multibillion-dollar shortfall, increasing pressure to identify new revenue sources.

Reaction in the Legislature has been mixed, with some lawmakers open to considering a seasonal tax and others wary of imposing new taxes, particularly in an election year. Any measure would require approval from both chambers before becoming law.

Dunleavy has emphasized that the sales tax would be temporary rather than permanent, positioning it as one component of a broader fiscal strategy that is likely to evolve as negotiations continue.

4. New York & California Tax Policies Are Fueling Wealth Flight, Scrutiny Of Movers

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Credit: ©Studio One-One/Getty Images

High-tax states like New York and California are tightening their grip on wealthy residents even as those same tax policies appear to be helping drive them away. New York state tax authorities are being described as “extremely aggressive” in chasing down wealthy residents who relocate to lower-tax states like Florida, with audits and complex domicile rules making it harder than expected to escape tax obligations — even if someone spends significantly more time outside the state. Experts say enforcement could intensify as local leaders push for higher taxes on top earners.

In New York, the push comes amid broader debates over tax hikes on high-income individuals, and critics warn that audits can ensnare remote workers and former residents if residual ties to the state remain strong. Wealthy taxpayers are increasingly sensitive to these enforcement actions, contributing to outmigration.

Across the country, California’s proposed 2026 Billionaire Tax Act — a one-time 5 % levy on ultra-wealthy residents — is stirring similar reactions. Some of the state’s wealthiest individuals and business leaders have publicly weighed whether they should stay and pay or leave, with multiple billionaires reportedly relocating assets and even homes to states without income taxes to avoid the new levy.

State officials defending the California measure argue that taxing the ultra-wealthy more equitably could fund critical services, but opponents warn that losing top taxpayers could undermine state revenue and accelerate outmigration, especially in a competitive environment where states like Florida and Texas actively court high-net-worth movers.

5. South African Finance Minister Says Major Tax Overhaul Unlikely In 2026 Budget

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Credit: Johannes Mann/Getty Images

South African Finance Minister Enoch Godongwana told Bloomberg and other outlets that he does not plan to pursue major tax changes in the upcoming 2026 national budget, emphasizing fiscal consolidation and stability as top priorities ahead of the Feb. 25 budget speech. Godongwana’s comments follow months of debate over revenue measures after previous proposals to raise the value-added tax (VAT) faced political pushback and were scaled back or reversed amid broader fiscal challenges.

Tax policy remains a hot topic in South Africa as the government grapples with a large budget deficit, high debt levels and slow economic growth; past budget drafts included possible increases in VAT and other taxes to shore up revenue, though those moves were moderated after resistance from political partners and the public.

Godongwana has signaled that enhanced tax collection efforts, particularly through the South African Revenue Service (SARS), and improvements in economic data could reduce the need for headline tax increases in 2026, even as the Treasury considers options for closing revenue gaps without undermining growth.

Observers note that VAT has been a recurring flashpoint in budget negotiations, with earlier proposals to raise it by up to two percentage points generating backlash before being scaled back to more modest adjustments or shelved altogether. The finance minister’s remarks at the World Economic Forum and in other forums suggest that South Africa’s tax strategy for 2026 will likely focus on targeted tweaks and compliance rather than dramatic new levies, even as fiscal pressures persist.

Which headline this week most interests you?

Feature Image Credit: Mark Newman/Getty Images

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Rebekah Barton

Rebekah Barton

Rebekah's search engine optimization career began completely by accident as a college student. Over the course of her career so far, she has "grown up" with the SEO industry, from writing content while juggling classes to managing her own teams of writers and overseeing SEO strategy in subsequent roles. She is excited to bring her passion for high-quality content to CountingWorks, Inc.

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