The Income Tax Department of India has announced significant updates to the Income Tax Return (ITR) forms for the assessment year 2026-27, which corresponds to the financial year 2025-26. The changes, notified by the Central Board of Direct Taxes (CBDT) on March 20, 2026, will take effect on April 1, 2026. While the updated forms aim to enhance transparency and simplify the tax filing process, they do not modify the existing income tax slab rates. Key updates include new disclosure requirements for long-term capital gains (LTCG), Futures & Options (F&O) transactions, and foreign assets. For instance, the ITR-1 form now allows taxpayers to report income from up to two house properties and LTCG up to ₹1.25 lakh. The ITR-2 form has removed previous distinctions in capital gains reporting and introduced more detailed disclosure for donations and foreign assets. Similarly, ITR-3 and ITR-4 forms have increased reporting requirements for business transactions and banking information. Taxpayers need to select the appropriate ITR form based on their income sources and business activities to ensure compliance.