All articles tagged with #tax refunds
President Trump bets bigger spring tax refunds—bolstered by the GOP tax cuts—that they’ll boost his political fortunes, but economists warn the relief could be short-lived as rising costs (housing, healthcare, energy) erode gains, with many filers not receiving large refunds and one-off payments unlikely to shift long-term sentiment.
The White House says President Trump’s Working Families Tax Cuts Act will trigger the largest-ever U.S. tax refund season, with average refunds rising by about $1,000 or more in 2026 and many filers seeing near $4,000 in total tax savings, backed by various outlets noting retroactive provisions and expanded refunds, including no tax on tips, overtime, or Social Security and other incentives.
US retail sales rose 0.6% in November, beating economists’ expectations after October’s revised pullback, with gains broad across categories (specialty stores +1.9%, gas stations +1.4%, home improvement +1.3%). The core 'control group' increased 0.4%. After adjusting for inflation, sales were up 0.3% from September to November, underscoring consumer resilience into the holiday season and into 2026 as tax refunds and policy shifts are expected to support spending despite a softer labor market.
The IRS provides resources and guidance on the new tax law provisions from the One, Big, Beautiful Bill, including deductions for seniors, no tax on tips, overtime, and car loan interest, along with tools for taxpayers to manage their taxes and refunds efficiently.
The 2026 tax refund season is expected to be larger and more favorable due to new tax laws, expanded deductions, and delayed withholding adjustments, with refunds potentially exceeding $4,000 on average, and arriving mainly in mid to late February through early March, especially benefiting middle and upper-middle-income households.
A surge in tax refunds is expected in 2026 due to retroactive tax cuts from 2025, potentially increasing average refunds by $557, which could impact the US economy, though uncertainties remain due to political and fiscal issues.
Billy Long, who previously promised significant tax refunds, is being considered by Donald Trump to lead the Internal Revenue Service (IRS). This potential appointment comes amidst discussions about tax policies and leadership changes within the agency.
Today is Tax Day, the last day for most taxpayers to file a 2023 return or request an extension. The IRS has received over 100 million returns and processed just over 100 million, with an average refund of $3,011. Post offices no longer stay open late on April 15 due to the majority of taxpayers filing electronically. Taxpayers in Maine and Massachusetts have until April 17 to file and pay taxes due this year. The IRS estimates 19 million taxpayers will file for an automatic extension, giving them until October 15 to file their taxes.
The IRS reports a 9.7% increase in the use of its Free File guided tax software for the 2024 filing season, with 943,000 taxpayers submitting returns through the program. Refunds totaling $92.9 billion have been sent out, with an average payment of $3,213. The agency is also launching a pilot scheme called Direct File, providing a free tax payment system for eligible American workers. Additionally, the IRS is cracking down on high-earners who have failed to file tax returns, identifying 125,000 suspected cases of non-compliance among those earning over $400,000 annually.
A recent study by Assurance IQ found that 72% of American taxpayers expecting a refund this year plan to spend it, with 36% intending to pay off debt and 30% to catch up on bills. Only 42% plan to put some of the refund into savings, while 29% are considering using it to pay for insurance due to rising premiums. Lower-income households hit hard by inflation may use the refund to catch up on debt or cover critical expenses. Additionally, 23% plan to spend it on something "fun," 19% to invest it, and 3% to donate it.
The US federal budget deficit for January dropped to $22 billion as receipts reached a record high, partly due to a decrease in tax refunds after the IRS cleared a backlog of pandemic-delayed returns. The deficit was 43% lower than in January 2023, with outlays growing by 3% to $499 billion and receipts jumping by 7% to $477 billion. The deficit for the first four months of the fiscal year increased by 16% to $532 billion, driven by rising costs for servicing the national debt, Social Security, Medicare, and military programs. Interest costs on the public debt grew by 35% due to higher interest rates and debt levels, while Medicare and Social Security costs also rose.
A proposed overhaul of the Trump-era tax law could potentially double the state and local tax (SALT) deduction cap to $20,000 for married couples, resulting in bigger tax refunds for millions of Americans. The change, retroactive for the 2023 tax year, aims to address concerns about the $10,000 cap disproportionately affecting middle-class homeowners in high-tax states. The proposed law, called the SALT Marriage Penalty Elimination Act, is expected to be voted on in the House next week and would apply to joint returns for couples with adjusted gross income below $500,000 in 2023.
More than 700,000 households in Michigan will receive an average of $550 in tax credit checks starting in February 2024 as part of $1 billion in tax cuts signed into law earlier this year. The checks are a result of the expansion of the Working Families Tax Credit, which was quintupled to 30% of the federal Earned Income Tax Credit. Eligible residents who qualify for the credit should apply this year and will receive the additional tax credit check from their 2022 tax return. The Department of Treasury will automatically process the checks, which will be mailed on a rolling basis.
Governor Gretchen Whitmer of Michigan announced that approximately 700,000 households in the state will receive refund checks averaging $550 early next year. The checks are part of an overhaul of Michigan's tax policies, which increased the Earned Income Tax Credit (EITC) for low- and moderate-wage workers. The checks will be the difference between the 6% tax credit received on their tax return and the 30% owed under the new law. Eligible residents do not need to submit additional paperwork, and the checks will be automatically processed and mailed on a rolling basis.
Colorado voters rejected Proposition HH, a measure that would have lowered property tax bills for homeowners in exchange for decreasing a state-specific tax refund. The measure aimed to prevent property tax bill increases and provide relief to seniors and working families. However, opponents argued that it could ultimately cost taxpayers more than they save on property taxes. The measure would have also resulted in smaller taxpayer refunds for renters without providing direct relief. Voters did approve another tax measure that allows more funds from a tobacco tax to be allocated to the state's universal preschool program.