Federal tax collections rose 4.5% to $5.55 trillion in fiscal 2026 as corporate taxes fell, IRS report shows

Federal tax collections reached $5.553 trillion in the 2026 fiscal year, which ended on September 30, up $239.3 billion, or 4.5%, from $5.314 trillion in fiscal 2025. The figures come from the Internal Revenue Service's Agency Financial Report for fiscal 2026, which the agency announced on November 12. Individual income and payroll taxes rose by more than the total did, by our comparison of the report's figures, while corporate income tax collections fell.

The report covers the taxes the IRS collects for the federal government, which the agency cannot spend itself, as well as its own budget. For the 27th year in a row, the Government Accountability Office gave unmodified audit opinions on the IRS's financial statements and on its internal control over financial reporting, the IRS said.

Where the money came from

In the IRS's accounts, individual income taxes include the Social Security and Medicare taxes paid under the Federal Insurance Contributions Act and the Self-Employment Contributions Act. That line rose by $275.2 billion. Corporate income taxes fell by $43.5 billion, and estate and gift taxes rose by $8.9 billion, to $40.0 billion from $31.1 billion. The report names those three changes as the main drivers of the overall increase.

Refunds and the filing season

Refunds and other payments the IRS makes on the government's behalf rose to $670.1 billion from $638.8 billion. The report attributes most of the $31.3 billion increase to corporate tax refunds, which rose by $27.8 billion. Individual refunds rose by $5.9 billion and excise tax refunds fell by $2.1 billion. The total also covers refundable tax credits such as the Premium Tax Credit and other outlays, among them the Trump Accounts Contribution Pilot Program.

In the report's opening message, the IRS chief executive says the agency processed 276 million individual returns and forms in the 2026 filing season and issued about 120 million refunds totaling nearly $415 billion, which the message describes as a 16% increase over the year before, with 90% of refunds delivered within 21 days. About 98% of taxpayers who got refunds used direct deposit, compared with 94% at the same stage of the 2025 filing season, the report says.

The agency links that season to the Working Families Tax Cuts, its name for a set of provisions in the One Big Beautiful Bill Act, enacted on July 4, 2025. The report lists among them no tax on tips, no tax on overtime, no tax on car loan interest for American-made cars and a new deduction for seniors. Our explainer on the tips and overtime deductions sets out how the first two work.

A smaller agency

The IRS also spent less on itself. Its obligations fell to $14.8 billion in fiscal 2026 from $19.4 billion. Salaries and benefits fell by $3.1 billion, which the report attributes to reduced staffing, and contract spending fell by $1.2 billion after contracts were renegotiated or canceled in fiscal 2025. The report puts most of the $3.9 billion fall in the IRS's net cost of operations down to the more than 23,000 employees who took up offers under the Deferred Resignation Program.

Strong financial management is central to public trust.

What comes next

The financial report leaves the agency's full performance figures for later. The IRS says its complete performance results for fiscal 2026 will appear in its congressional budget justification for fiscal 2028, to be published in spring 2027.