The tax landscape continues to shift at a rapid pace, with new IRS digital tools, evolving federal tax policy discussions, and emerging state tax developments creating both opportunities and challenges for practitioners.
These topics were among the key issues explored during the latest session of June’s Washington Tax Brief, AICPA's update helping tax professionals stay informed about legislative, regulatory, and administrative developments affecting practice today.
From enhancements to IRS Individual and Tax Pro Accounts, to significant developments surrounding tariff refunds and growing state-level sales tax activity, the briefing offered valuable insights into issues that are likely to remain on practitioners' radar throughout the second half of the year.
IRS expands digital tools for taxpayers and tax professionals
The IRS continues to advance its digital transformation strategy, with significant enhancements to both Individual Online Accounts and Tax Pro Accounts designed to improve taxpayer service and simplify interactions with tax professionals.
During the briefing, IRS representatives highlighted a variety of recent improvements, including expanded digital notice capabilities, refund status notifications, and new account management features. Taxpayers can increasingly access account information, receive proactive communications, and manage interactions with the IRS through secure online channels.
Tax professionals are also seeing expanded functionality. Recent enhancements to the Tax Pro Account include capabilities that better support firms operating under business structures, improved authorization management, and expanded access to taxpayer information. Looking ahead, the IRS outlined plans to continue broadening self-service options, including additional payment capabilities and greater access to client notices.
For practitioners, these developments signal the IRS's continued commitment to transformation. As adoption of these tools grows, firms that understand how to incorporate them into their workflows may be able to improve efficiency while providing a more streamlined experience for clients.
Tariff refunds present both opportunities and complexities
One of the timeliest discussions during the briefing centered on tariff refund developments following recent court rulings involving certain tariffs imposed under the International Emergency Economic Powers Act (IEEPA).
The discussion highlighted the potential for substantial refunds for some importers, while also drawing attention to the broader impact on businesses that may have indirectly absorbed tariff-related costs through increased prices. Although many practitioners may not traditionally view tariffs as a core tax issue, the developments create a meaningful opportunity to engage clients in proactive conversations.
Businesses that import products directly or purchase goods through importers, and organizations that experienced significant cost increases as a result of tariffs may all be affected in different ways. At the same time, the refund process itself remains complex, with varying filing requirements and procedural considerations that could influence eligibility and outcomes.
Perhaps the most important takeaway for practitioners is the advisory opportunity. Many businesses may not realize that these developments could affect them, creating an opening for firms to provide additional value by identifying potential opportunities and helping clients understand their options.
Federal tax policy discussions point to future developments
The briefing also offered an inside look at tax policy discussions taking place in Washington and the issues that could shape future legislative debates.
While many of the proposals discussed remain early-stage concepts, the conversation highlighted growing interest in areas such as partnership tax reform, IRS funding and enforcement, standard deduction enhancements, tax credit expansions, and energy-related tax provisions. Policymakers are also continuing to debate issues surrounding taxpayer data protection, oversight, and broader IRS governance.
For tax professionals, these discussions serve as an early indicator of where future legislation may be headed. Even when proposals do not advance immediately, they often establish policy frameworks that re-emerge in later negotiations. Maintaining awareness of these developments can help practitioners better anticipate planning opportunities and prepare clients for potential change.
State tax issues continue to evolve
State tax developments remain another area requiring close attention. During the briefing, speakers highlighted ongoing changes to pass-through entity tax (PTET) regimes as well as the growing interest among states in expanding sales tax bases to include professional services.
PTET continues to evolve as states modify, extend, and, in some cases, make permanent these regimes. What began as a workaround to the federal state and local tax deduction limitation is increasingly becoming a long-term feature of many state tax systems. As a result, practitioners need to continue evaluating the implications for clients operating across multiple state jurisdictions.
At the same time, multiple states are exploring ways to broaden their sales tax base as economies become increasingly service-oriented. In some cases, proposals have included professional services, raising important considerations for both CPA firms and their clients. While legislative outcomes remain uncertain, the trend underscores the importance of state-level monitoring, advocacy efforts, and collaboration with state CPA societies.
As state tax rules become more complex and divergent, staying informed about developments across state jurisdictions is becoming just as important as tracking federal changes.
Staying ahead of change
A consistent theme throughout the Washington Tax Brief was the accelerating pace of change facing the profession. Whether it is the IRS's continued investment in digital services, emerging tariff-related opportunities, or evolving federal and state policy discussions, tax professionals are increasingly expected to serve as strategic advisers who can help clients navigate uncertainty.
Staying informed on these developments is critical not only for compliance but also for identifying opportunities to provide greater value and strengthen client relationships.
Join us for upcoming Washington Tax Brief sessions
The conversation continues on August 12, when the next Washington Tax Brief will provide updates on the latest legislative, regulatory, and administrative developments affecting tax professionals.
Practitioners can also look ahead to a special edition of the Washington Tax Brief on November 9, broadcast live from the AICPA National Tax Conference. The session will bring together tax policy leaders, technical experts, and government representatives to discuss the issues shaping the profession and what practitioners need to know heading into 2027.