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26th February 2026
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THE HOT STORY

First month of tax season sees record refunds

With the first month of tax season coming to a close, the IRS reports that the average refund has increased to $2,746, which is over $300 more than last year. The rise has been attributed to the decision not to alter tax withholding tables and the implementation of the One Big Beautiful Bill Act, which has led to more money returned to taxpayers. However, the IRS has noted that guidance on some provisions of the Act is still pending, contributing to a significant increase in visits to IRS.gov, which reached 176m. Despite the higher refunds, the number of taxpayers preparing their own taxes remains stable at around 19m while professional tax preparation has decreased from 13.4m to 12.7m.

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TAX

Iowa lawmakers tackle property tax reform

Iowa lawmakers recently held a subcommittee hearing on Gov. Kim Reynolds' proposal to cap property tax growth and restrict tax increment financing (TIF). The proposal aims to limit local revenue growth to 2% annually, with exceptions for debt service and school funding, and to freeze property tax bills for homeowners aged 65 and older with homes valued at $350,000 or less. Ms. Reynolds' office claims the legislation could reduce property taxes by $3bn over six years. However, local leaders expressed concerns that TIF restrictions could hinder economic development, with Chelsea Hoye from the Iowa League of Cities stating: “Tax increment financing has been the primary tool used to make those projects possible.” The hearing marked the first opportunity for public feedback on property tax bills this year.

Portland leaders push to lift tax burden for small businesses

Portland's elected officials are advancing a proposal to enhance the business license tax exemption for small businesses, aiming to stimulate economic growth. Sponsored by Mayor Keith Wilson and Councilor Eric Zimmerman, the measure seeks to increase the exemption from $50,000 to $75,000 for tax year 2026 and to $100,000 for tax year 2027. The Finance Committee approved the measure unanimously, and it is expected to pass in the full council. This tax break is designed to support independent contractors, start-ups, and mom-and-pop shops, costing the city approximately $1.3m in its first year and $2.5m annually thereafter. City officials estimate that around 10,000 additional businesses will benefit from this relief, which Wilson announced at the Oregon Leadership Summit.

INDUSTRY

GAO urges stronger IRS oversight of tax preparers

A new Government Accountability Office (GAO) report is calling on the IRS to strengthen oversight of paid tax preparers, warning that errors by unqualified preparers can cost taxpayers money and reduce federal revenue. The GAO found that paid preparers - especially those without professional credentials - often make serious mistakes that can cause taxpayers to miss benefits, face audits or incur penalties. While all preparers must have a Preparer Tax Identification Number, only credentialed professionals such as CPAs, attorneys and enrolled agents are subject to IRS regulation. Unenrolled preparers are not required to meet testing or continuing education standards. The report urges Congress to grant the IRS clearer authority to set professional and security requirements for all paid preparers. Tax professional groups expressed support for stronger education and competency standards, arguing that consumers would benefit from minimum training and ethical requirements for anyone preparing returns for pay.

FASB to rethink risk management accounting rules

Banks and insurance companies achieved a significant milestone on Wednesday, when the FASB agreed to modify risk management reporting guidelines. The board unanimously decided to include a short-term project on hedge accounting in their technical agenda, addressing concerns raised during last year's outreach. This elective accounting practice is crucial for companies aiming to reduce earnings volatility. Companies and trade groups have been advocating for simpler rules, citing the current regulations as "costly and time-consuming to apply."

CPA firms face outsourcing compliance challenges

Many CPA firms are turning to outsourcing to enhance efficiency and growth, but it also presents challenges in adhering to various regulations. A significant oversight is treating compliance tasks as separate entities, which can lead to issues with IRS Section 7216, the AICPA Code of Professional Conduct, and the FTC Safeguards Rule. 

FIRMS

Deloitte hires former Ways and Means official to boost tax policy practice

Deloitte has appointed longtime Congressional advisor Mark Roman as deputy managing principal of the tax policy group within its Washington national tax practice. Roman joins the firm after two decades in the U.S. House of Representatives, most recently serving as staff director of the House Committee on Ways and Means during the 118th and 119th Congresses.

ECONOMY

U.S. economy set for growth surge, IMF says

The International Monetary Fund (IMF) anticipates a robust U.S. economy over the coming year, forecasting a 2.4% growth in GDP for the fourth quarter of 2026, up from 2.2% the previous year. Unemployment is expected to decrease from 4.5% in late 2025 to 4.1% in 2026, with inflation projected to meet the Federal Reserve's 2% target by 2027. However, IMF managing director Kristalina Georgieva cautioned that rising federal debts, projected to reach nearly 110% of GDP by 2031, pose a significant risk to stability. Georgieva noted that trade policies could hinder economic performance, describing them as "a headwind to even stronger growth."

CORPORATE

Jefferies sued over alleged misrepresentation in First Brands-linked fund

Jefferies Financial Group has been sued by investors who claim the firm misled them into investing in a trade finance fund tied to now-bankrupt auto parts supplier First Brands. In a lawsuit filed in New York state court, British Virgin Islands-based Eugenia II Investment Holdings and Eugenia III Investment Holdings allege that Jefferies and its Point Bonita Capital fund falsely represented that they had “cash dominion” over receivables purchased from First Brands. The complaint claims that, in reality, First Brands retained control of the funds while allegedly double-pledging collateral and manipulating invoices as part of what federal prosecutors have described as a multibillion-dollar fraud. Jefferies has denied the allegations. First Brands founder Patrick James and his brother Edward James were indicted last month on fraud and conspiracy charges related to the company’s collapse and have pleaded not guilty.

LEGAL

Former Supreme Court attorney convicted of tax and mortgage fraud

Thomas Goldstein, a once-prominent Supreme Court lawyer and co-founder of SCOTUSblog, has been convicted on 12 of 16 federal charges, including tax evasion, failure to pay taxes, and lying to mortgage lenders. After a six-week trial, prosecutors argued that Goldstein concealed millions of dollars in income from high-stakes poker games, alleging he executed a years-long tax evasion scheme tied to his gambling activities. They said he earned roughly $50m from poker in 2016 alone, including significant offshore winnings that went unreported. Goldstein, who argued more than 40 cases before the Supreme Court and retired from legal practice in 2023, testified in his own defense. He denied knowingly evading taxes and said he relied on accountants and office managers to handle financial matters. He admitted omitting gambling debts from mortgage applications but claimed he did so to hide them from his wife.

Tax Court limits jury trial options

Taxpayers considering a jury trial under Jarkesy v. SEC for security fraud penalties should reconsider due to a recent Tax Court ruling. The Supreme Court's decision in Jarkesy affirmed the right to a jury trial for civil penalties, but the Tax Court in Silver Moss Properties, LLC v. Commissioner ruled that taxpayers are not entitled to a jury trial for fraud penalties under IRC Section 6663. The court stated that sovereign immunity prevents such claims since the taxpayer is suing the government. Taxpayers must appeal the Seventh Amendment issue to the Court of Appeals, facing the risk of additional trials in different courts. A. Lavar Taylor, founder of Taylor Nelson Amitrano, emphasizes the complexities and costs involved in pursuing these appeals, noting that standalone tax penalties may differ from those tied to tax liabilities.

U.S. courts wants Trump administration to reveal information about Elon Musk's DOGE

Bloomberg reports that U.S. courts are forcing the White House to reveal information about the Department of Government Efficiency (DOGE) and Elon Musk's role in it. Judges have ordered the government to disclose the names of DOGE employees and contractors, and to investigate phone numbers that Musk may have used for official business. The Trump administration faces multiple lawsuits seeking transparency and accountability for the department's actions, including its access to government systems and records with sensitive financial or personal data. “You really are seeing an unwillingness from the government to shed any type of light or any type of accountability for what happened,” said Tianna Mays, legal director of Democracy Defenders Fund.

WEALTH MANAGEMENT

Wealth management partnerships reshape CPA landscape

The accounting profession is undergoing a significant transformation as firms face increasing pressures and competition. With nearly 40,000 public accounting firms in the U.S., many CPAs are considering strategic partnerships with wealth management firms as a viable alternative to traditional mergers. This shift is highlighted by the fact that financial acquirers accounted for 32.9% of accounting sector deals in 2024, up from 18.9% in 2023. Partnering with wealth management firms allows CPAs to gain a comprehensive view of clients' financial situations, leading to more precise advice and better planning opportunities. As one CPA notes:  "Instead of being pushed away from the work they love, they gain expanded capabilities." This approach not only enhances client relationships but also alleviates the seasonal pressures that often lead to burnout, creating a more sustainable work environment for tax professionals.

INTERNATIONAL

OECD, UN urged to align on pro-growth international tax reforms

The OECD and the United Nations are both engaged in significant reforms to international taxation, raising questions about potential rivalry and cooperation. Daniel A. Witt, president of the International Tax and Investment Center, emphasizes the need for both organizations to focus on "tax policies that promote investment and growth." While the OECD has a history of prioritizing advanced economies, the UN aims to give developing countries a stronger voice. Both organizations share common goals, such as avoiding double taxation and ensuring fair allocation of taxing rights. The success of their frameworks hinges on collaboration and communication, which could ultimately benefit both domestic and foreign investors.

Workplace equality exists nowhere, World Bank says

The World Bank has said that full workplace equality does not exist anywhere in the world, and only "less than 5% of women worldwide" live in economies with near full legal economic equality. Even in instances when workplace equality laws are passed by lawmakers they are truly enforced in only about half of all cases, the World Bank said in a report on women, business and the law. “Even in economies that have modernized their laws, women still face constraints that shape the work they can do, the businesses they can start, and the safety they need to pursue opportunities,” said Dr Indermit Gill, the bank’s chief economist.
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