I've been preparing returns for 15+ years and have seen every tax season curveball, so here's what I'm telling my Phoenix clients about 2026: **Why 2026 is different:** The biggest issue is the TCJA provisions expiring at the end of 2025--standard deductions are dropping, personal exemptions are coming back (which sounds good but isn't), and state/local tax deductions are no longer capped at $10k. If you're used to taking the standard deduction, you might need to itemize now, which completely changes your filing approach. I've got clients who paid zero attention to charitable contributions for years who now need receipts for everything. **Cost reality:** Most CPAs I know are charging $400-800 for a straightforward 1040 with a Schedule C, up about 15-20% from last year. Why? Because nothing is straightforward anymore when half the tax code just changed. I spent 40 minutes on a return last week that would've taken 15 in 2024 because we're basically learning new rules in real-time. **What DIYers miss:** The big one right now is the home office deduction coming back stronger without the old limitations. I found $3,200 for a client last month who was using TurboTax for years--they never calculated the depreciation portion correctly. Second is retirement contributions if you're self-employed; the software asks the questions but most people don't understand what SEP-IRA vs Solo 401k means for their specific situation. In my software tech and AdTech clients, I've seen people leave $8k-12k on the table annually just on retirement alone. **Hiring mistakes:** Biggest mistake is hiring based on price alone. Ask your CPA what continuing education they've done specifically on the 2025 changes--if they can't name specifics, walk away. Also ask how they handle IRS notices; I've cleaned up so many messes from preparers who disappear when the IRS sends letters.
I'm Samuel Landis, tax attorney with an LL.M. in Taxation--I've spent 15+ years resolving IRS controversies and teaching tax law, so I've seen what trips people up when tax landscapes shift. **The substitute for return trap nobody's talking about:** When the IRS doesn't receive your filing, they'll prepare one for you and it's always worse than reality. I just handled a case where the IRS created an SFR that overstated tax by $47,000 because they couldn't see deductions or credits--only income reported by third parties. With 2026's changes, more people will delay filing or mess up their returns, triggering more SFRs. The IRS gives you 30 days to respond before they move to formal assessment and start seizing assets. **What actually costs more than hiring us:** The failure-to-file penalty is 5% per month versus 0.5% for failure-to-pay--that's ten times higher. I had a client who avoided filing for three years thinking they'd save money by doing it themselves later. By the time they came to us, penalties alone were $23,000 on a $60,000 tax bill. We got them compliant, filed for penalty abatement, and negotiated an offer in compromise that settled the entire case for $8,500. Our fee was $4,200--they netted saving over $70,000. **The question nobody asks but should:** "What happens if the IRS contacts me after you file?" Most preparers ghost when letters arrive. We handle all IRS correspondence as part of representation because audit defense and notice response is where real damage happens. I've taken over cases where a discount preparer charged $300 for filing but the client ended up with a $15,000 assessment because nobody responded to a CP2000 notice properly.
Why 2026 is different for taxpayers 2026 stands out for three reasons. First, delayed and phased-in rule changes from recent legislation (including OBBBA-related provisions) are now impacting deductions, credits, and reporting thresholds in non-obvious ways. Second, IRS enforcement is more targeted and data-driven, increasing audit and notice risk from mismatches and omissions. Third, inflation adjustments and the expiration of prior relief provisions mean similarly situated taxpayers can see very different outcomes based on timing and structure. Are taxes more complicated this year, even for DIY filers? Yes. Even "simple" returns are affected by layered rules around credits, income phaseouts, side income, multi-state work, and digital asset reporting. Tax software is good at calculations, but it's reactive—it only addresses issues you know to ask about. Most costly mistakes happen before the return is prepared. Why hire a tax pro in 2026 A good tax professional does more than file forms—they plan. We routinely save clients several times our fee by optimizing income timing, deductions, entity structure, and credit eligibility, while also reducing penalty and audit exposure. The gap between filing and planning has never been wider. Cost to hire a tax pro in 2026 Individuals with relatively straightforward returns typically pay $400-$800. Small business owners, contractors, or investors generally pay $1,200-$3,000 or more, depending on complexity. Costs are higher than in prior years due to increased compliance requirements, staffing shortages, and the time needed for proper review and documentation. Most commonly missed money by DIY filers DIY filers often miss partial credits, misclassify expenses, underuse depreciation, overlook retirement strategies, and fail to optimize income timing. A tax planner looks across multiple years, not just one return. Biggest mistakes when hiring a tax pro The biggest mistake is choosing based on price alone. Consumers should ask whether the professional provides proactive planning, how they help reduce taxes before year-end, and whether they have experience with the taxpayer's specific income or entity type.
Attorney and Chief Executive Officer at Cummings & Cummings Law
Answered 2 months ago
I am a tax attorney and CPA. I also teach business and tax law at the university level. My law and CPA firm is Cummings & Cummings Law, headquartered in Bonita Springs, Florida. Our website is www.cummings.law. The 2026 filing season involves new line items that many filers will get wrong. The One Big Beautiful Bill Act which was passed into law on July 4, 2025 created multiple above-the-line deductions that interact with income limits and timing issues. These include up to $25,000 for reported tips, $12,500 for overtime pay, and $10,000 for interest on new car loans. All three begin phasing out at $100,000 of modified adjusted gross income for single filers and $200,000 for joint filers. Every $1,000 over that threshold reduces the deduction by $200. Above $150,000 or $250,000, the benefit disappears. That's a key point. Documentation requirements vary. For many of our clients, a failure to maintains documentation prevents us from claiming these deductions and credits they would otherwise be eligible to take. Self-prepared returns are more likely to miss timing restrictions or trigger disallowance. I tell clients all the time: you working perform brain surgery on yourself so why would you practice law on yourself by preparing your own return? The tip and overtime deductions require employer reporting through W-2 Box 1. Tips must match what was actually reported to the IRS. The car loan deduction only applies to new vehicles assembled in the United States with a VIN disclosed on the return. Vehicles manufactured in Mexico or Canada do not qualify. Many filers will not realize the deduction applies retroactively to qualifying 2025 purchases made before July 4. Software will not cross-check these conditions. Many preparers will increase rates this season due to the intake burden and audit risk. We have deliberately limited the number of tax engagements we are accepting this spring to allow us to devote extra time to existing clients and educate them on OBBBA changes. I am hearing the same from colleagues and competitors. As a result, preparation fees are up... ours have increased 50% versus 2025 (for the 2024 tax year). My full profile and credentials are viewable on Featured and on my website. Please contact directly via email at chad@cummings.law should you have any follow up questions or wish to schedule a Zoom conference.
What most taxpayers don't realize about filing 2025 taxes in 2026 1. 2026 is the first year "data-first" IRS matching meaningfully impacts refunds The IRS is no longer primarily reviewing returns after filing — it's increasingly validating them before refunds are released. Practical impact: Refunds are delayed when reported income doesn't perfectly match IRS data feeds (1099s, brokerage statements, payment apps). DIY filers often file early using estimates or partial forms, triggering automatic holds. This is one of the biggest hidden reasons professionally prepared returns receive refunds faster in 2026. 2. "Correct" is no longer the same as "optimal" under OBBBA-era rules OBBBA introduced income cliffs where $1 of additional income can cost thousands in lost credits. A practical example: A household earning slightly over a phaseout threshold may lose eligibility for childcare credits, education credits, or health subsidies. A tax planner can often fix this legally by adjusting income timing or retirement contributions. Tax software will not flag these cliffs — it will simply calculate the higher tax. 3. New "silent penalties" are catching DIY filers off guard These aren't labeled as penalties, but function like them: Lost credits due to form sequencing errors Automatic underpayment interest from miscalculated quarterly estimates Disallowed deductions due to missing elections Once missed, many of these cannot be corrected with an amendment. 4. The real cost of a tax pro is now net-negative for certain filers In 2026, the biggest ROI from a tax pro is showing up outside the tax return. Examples: Identifying that a side gig should be taxed as an S-corp Correcting multi-state issues before penalties accrue In these cases, the tax pro fee is often recovered before the return is filed. 5. One question smart consumers now ask before hiring a tax pro Instead of "How much do you charge?" the better question in 2026 is: "What decisions on my 2025 return are irreversible after April 15?" If the preparer can't answer that clearly, they're likely doing compliance — not advisory. 6. The biggest DIY mistake in 2026: filing too early Many consumers rush to file in February, but late 1099s and corrected brokerage statements are increasingly common. Tax pros often recommend filing later with complete data rather than amending later, which can raise audit risk.