An internal watchdog office at the IRS recently sent a list of concerns to Congress related to charitable giving, technology, agency staffing, and more. The National Taxpayer Advocate annually prepares a report making recommendations for better protecting taxpayer rights and easing the taxpayer burden.
Included in this year’s report is a compilation of 71 legislative recommendations, including one to eliminate the requirement that, in order to deduct a charitable contribution of $250 or more, a taxpayer must obtain written acknowledgment “contemporaneously”—or within a short window of time from the donee organization.
“Strict contemporaneous timing requirements harm taxpayers and tax-exempt organizations that make a technical mistake in their written acknowledgments or that provide some required or corrected information after the statutory deadline has passed,” states the report. “Removing the ‘contemporaneous’ component… would still require taxpayers to provide sufficient evidence to substantiate their deductions, but it would reduce taxpayer burden and give the IRS and the courts common-sense flexibility in administering the law.”
In addition, the report proposes establishing a uniform standard mileage deduction rate. This would resolve the current IRS policy of three different standard mileage deduction rates, which causes confusion for taxpayers, tax professionals, and IRS officials.
The report also warned legislators that several factors are likely to present challenges in the 2026 tax filing season. A primary concern, according to National Taxpayer Advocate Erin Collins, is the significant workforce reduction at the IRS. A 27 percent decrease in the IRS workforce from 2025 to 2026 included the loss of many experienced managers and customer service representatives, with the report noting a substantially lower number of these reps for the upcoming filing season compared to last year. Of note, in the Tax Exempt Government Entities (TEGE) office, personnel was reduced by 30 percent.
New considerations coming with the One Big Beautiful Bill Act are also noted in the report. Though most changes won’t take effect until 2026, several provisions are retroactive to January 1, 2025.
“While the OBBB Act is generally taxpayer-favorable in that it expands eligibility for certain deductions and benefits, the deductions and benefits are subject to complex eligibility rules, income thresholds, and phaseouts that will be difficult for many taxpayers to understand and for the IRS to administer accurately during the filing season,” said Collins.
Additionally, the report identifies the IRS plan to outsource the process of paper-filed tax returns as a potential for operational and confidentiality risks.
The 2025 National Taxpayer Advocate Annual Report to Congress is available on the Taxpayer Advocate Service website, along with the Purple Book with legislative recommendations. For guidance on 2025 tax returns, please also explore ECFA’s recently released 2026 Church & Nonprofit Tax & Financial Guide!