Record spending cuts to hit education
It is warning that young children and kids from middle-class families will be the hardest hit due to plans to favour schools in poor neighbourhoods.
However, nurseries and playgroups will be the worst affected, as "early years" education funding is slashed by a fifth.
Schools in more affluent areas will also suffer more due to the introduction of a "pupil premium" to provide extra money for educating the poorest children in society.
Luke Sibieta, senior research economist at the IFS and co-author of the report, told the Daily Telegraph that about 30% of primary schools and 40% of secondary schools would see a significant impact as their budgets failed to keep pace with rising costs.
"These are unquestionably the more affluent, less deprived schools," he said. "A school with only 5% of pupils entitled to free school meals would receive a budget increase of just 0.5%."
The government stresses that it has been forced to make "tough decisions" and blames Labour's inefficiency for wasting money over the past decade.
It also points out that the schools' budget is actually increasing by £3.6 billion over the next four years.
However, Chris Keates, the general secretary of the NASUWT teachers' union, argues that the cuts will have "massive implications" for the quality of children's education.
"So much for Michael Gove saying education was protected," she said. "It clearly is back to the future with this government."