IRS Publication 2104-C – The National Taxpayer Advocate Service (TAS) plays a crucial role in safeguarding taxpayer rights and improving IRS operations. Each year, the National Taxpayer Advocate submits an Annual Report to Congress, highlighting the most pressing issues faced by taxpayers and proposing solutions. IRS Publication 2104-C serves as the Executive Summary of this report for 2025, providing a concise overview of key findings, challenges, and recommendations. Released on January 28, 2026, by National Taxpayer Advocate Erin M. Collins, the report notes that taxpayer service was generally strong in 2025 but anticipates greater challenges in 2026 due to workforce reductions and complex tax changes.
This SEO-optimized guide breaks down the essentials of Publication 2104-C, drawing from official IRS sources to help taxpayers, professionals, and policymakers understand its implications. Whether you’re dealing with IRS delays, seeking better representation, or curious about systemic reforms, this article covers the core elements.
What Is IRS Publication 2104-C?
IRS Publication 2104-C is the official Executive Summary of the National Taxpayer Advocate’s 2025 Annual Report to Congress. It encapsulates the TAS’s analysis of taxpayer experiences during Fiscal Year 2025 (October 1, 2024, to September 30, 2025). The full report identifies systemic problems, evaluates IRS performance against taxpayer rights, and offers administrative and legislative recommendations to enhance efficiency and fairness.
The TAS, an independent organization within the IRS, has assisted over 5.8 million taxpayers in the past 25 years through case advocacy, systemic improvements, and programs like the Low Income Taxpayer Clinic (LITC). The report is submitted directly to Congress without prior IRS or Treasury review, ensuring unbiased insights.
Key objectives include protecting fundamental taxpayer rights, such as the right to quality service, the right to pay no more than the correct amount of tax, and the right to challenge IRS positions. It also assesses IRS modernization efforts amid staffing cuts and technological shifts.
Key Issues Identified in the 2025 Report
The Executive Summary outlines the “Ten Most Serious Problems” (MSPs) encountered by taxpayers, based on TAS casework, research, and stakeholder input. These issues highlight areas where the IRS falls short, often violating taxpayer rights and increasing burden.
Here’s a breakdown of the top problems:
- Amended Returns: Delays in processing refunds and confusing disallowance notices jeopardize taxpayers’ rights to review and appeal.
- IRS Modernization and Digitalization: Reliance on outdated paper processes and procurement delays hinder efficiency.
- Telephones: Inaccurate measurement of service quality fails to capture real taxpayer experiences, with low resolution rates.
- Independent Office of Appeals: Concerns over independence erode public confidence.
- Tax Pro Account: Limited functionality in online accounts for professionals impairs effective representation.
- Records Access: Delays and inadequate responses to requests for IRS records.
- Centralized Authorization File: Systemic failures undermine rights to representation and due process.
- Social Media: Misinformation on platforms harms taxpayers, with the IRS lacking robust countermeasures.
- Taxpayers Living Abroad: Severe compliance burdens for U.S. citizens overseas, including access issues and complex reporting.
- International Withholding Relief: Long delays in processes like FIRPTA and Form 8233 cause financial hardships.
Additional challenges include identity theft resolution times averaging nearly two years, with 316,000 pending cases, and over 30 million returns suspended during processing, leading to refund delays. The IRS processed over 165 million individual returns in FY 2025, issuing 104 million refunds averaging $3,167, but 3.6 million experienced delays.
Workforce reductions of 27% (from 102,101 to 74,465 employees) exacerbate these issues, forcing greater reliance on AI and self-service tools. New tax laws from the One Big Beautiful Bill Act (OBBB Act) introduce complexities, such as deductions for auto loans, tips, and overtime pay.
Recommendations to the IRS and Congress
The report provides actionable recommendations to address these problems. Administrative suggestions target IRS internal improvements, while legislative ones are detailed in the companion 2026 Purple Book, featuring 71 proposals.
Administrative Recommendations to the IRS
- Automate amended return processing and clarify notices.
- Refine procurement for digitalization and study in-house vs. outsourced scanning.
- Adopt outcome-based metrics for telephone service, focusing on first-contact resolution.
- Enhance Appeals independence with training and timelines.
- Expand Tax Pro Account features to match individual accounts.
- Improve records access through automation and waive fees for low-income taxpayers.
- Fix Centralized Authorization File issues with dedicated channels and e-signatures.
- Combat social media misinformation via partnerships and enhanced IRS presence.
- Better support overseas taxpayers with toll-free lines, e-filing, and awareness campaigns.
- Develop portals for international withholding relief and use AI for reviews.
Many recommendations have deadlines by September 30, 2026.
Legislative Recommendations to Congress
Highlighted from the Purple Book:
- Set minimum standards for tax return preparers and revoke PTINs for sanctioned ones.
- Expand Tax Court jurisdiction to refund cases.
- Remove LITC grant caps and reduce matching requirements.
- Require IRS to process refund claims within one year.
- Allow equitable tolling for all tax litigation deadlines.
- Strengthen penalties for contractors mishandling taxpayer data.
Three 2025 Purple Book recommendations were enacted in late 2025, including better math error notices and disaster relief extensions.
Notable Highlights and Statistics
- Filing and Processing: 94% of individual returns filed electronically; paper filings cause significant delays.
- Telephone Service: Over 100 million calls, but only 26% reached employees; Level of Service (LOS) at 60%.
- Litigation: 370 federal court opinions on tax issues, down 11%; top issues include unreported income and penalties.
- Criminal Investigations: $6.09 billion in identified financial crimes, with an 89% conviction rate.
- Improper Payments: 27.3% of Earned Income Tax Credit (EITC) payments improper, totaling $15.9 billion.
The report emphasizes the IRS’s Zero Paper Initiative and AI integration but warns of risks without adequate staffing.
Why This Report Matters for Taxpayers?
Publication 2104-C underscores the need for ongoing IRS reforms to reduce burdens and protect rights. For individuals, it highlights common pitfalls like refund delays and misinformation. Tax professionals can use it to advocate for better tools, while policymakers gain insights for legislation.
If you’re facing IRS issues, contact the TAS for free assistance. Download the full Executive Summary from the IRS website for detailed reading.
Stay informed about tax changes to avoid compliance pitfalls in 2026. For more on taxpayer rights, visit the official TAS site.