Tax refunds could be larger than usual for some taxpayers.
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Few things create as much tax season stress as a federal tax refund. Taxpayers worry when it’s less than expected, panic when it’s delayed, and cheer when it’s bigger — often without being entirely sure why.
As the 2026 filing season begins (the IRS officially opens for business on Jan. 26), refunds are expected to look bigger for many filers. See why this might happen, how big of a boost you might see, and answers to the most common refund questions taxpayers ask.
I hear the tax refunds are supposed to be bigger than last year. How much was the average tax refund in 2025?
According to IRS filing season 2025 statistics (for returns processed through December 2025), the average federal tax refund was $3,167. That was more than 2024.
So, what was the average tax refund in 2024?
According to IRS filing season 2024 statistics (for returns processed through December 2024), the average federal tax refund was $3,138.
How many people are we talking about? How many taxpayers received refunds in 2025?
According to the same statistics, 103,846,000 taxpayers received a total of $328.878 billion in tax refunds in 2025. This represents 63% of taxpayers—meaning more than six in ten taxpayers received a refund.
(This figure is slightly lower than in 2024, when 64% of taxpayers received a tax refund.)
Why are tax refunds expected to be bigger in 2026?
Refunds for the 2026 application period are expected to be higher than in previous years. One reason is the One Big Beautiful Bill Act (OBBBA). The OBBBA, which largely went into effect in July 2025, included expanded tax breaks such as an increased standard deduction, larger child tax credits and new deductions for overtime and tip income.
Despite the changes, the IRS chose not to update the withholding tables, meaning many taxpayers will have paid more tax than required during the year — resulting in larger refunds when they file in 2026.
Who Will See Bigger Tax Refunds?
The size of a refund depends on your individual tax situation, but the increase in 2026 is expected to be most noticeable among middle-income households (especially those earning between $50,000 and $150,000); families with children who take advantage of larger dependent credits, workers with tip or overtime income, and certain elderly taxpayers who qualify for additional deductions.
Who won’t see bigger tax refunds?
Not everyone will see a big hit. Lower-income taxpayers who already owe little or no tax may not see much of a change, and higher-income taxpayers may benefit less because some credits and deductions are phased out.
So, for those who will see a bump, how much are we talking about?
Quoted estimates vary—and it depends on your circumstances—but the increase is expected to average about $1,000 compared to recent years. That means the average refund could be over $4,000.
Can we count on the same result in 2027?
Not exactly. Although the tax laws are not expected to change again, the IRS will eventually update the withholding tables. This means you’ll likely see more in your paycheck over the course of the year – but future refunds may not be as “hit”.
This stinks. Isn’t a bigger refund always better?
It depends on who you ask. A larger refund usually means one of two things:
(1) You had too much withheld from your wages during the year, or
(2) you qualify for credits or deductions that were not reflected in the withholding;
Neither is necessarily a bad thing, but a large refund can also mean less earnings over the year and is the equivalent of giving the government an interest-free loan. That’s why some tax professionals say the perfect refund is close to zero.
What exactly is a tax refund?
For federal income tax purposes, a tax refund is usually the return of money you’ve already paid that turns out to be more than you owed. In other words, it’s the difference between what you paid during the year through withholding and estimated payments and your actual tax bill. If you paid more than your tax liability, the IRS sends you the extra amount as a refund. If you paid less than your tax liability, you owe the difference.
Will bigger deductions always result in bigger tax refunds?
It depends. A deduction lowers your taxable income, but doesn’t lower your tax bill dollar for dollar. Whether this results in a refund depends on how much you’ve already paid during the year. Deductions reduce the amount of income subject to tax. For example, if you earn $75,000 and claim $10,000 in deductions, you’re taxed on $65,000 — not $75,000. This lowers your tax bill, but does not guarantee a refund. Think of deductions as shrinking your tax bill.
Larger withholdings are more likely to result in (or increase) a refund if too much tax was withheld during the year, if you made estimated payments, or if the withholding was new or unexpected (like with OBBBA) and the withholding didn’t count. In these cases, the deduction reduces your tax liability below what you have already paid and the excess is returned to you as a refund.
That last point? That’s why we’ll see more refunds in 2026.
What about credits?
Credits are great, but most credits, by themselves, don’t create a refund. While they reduce your tax dollar for dollar, they generally cannot reduce it below zero.
However, some refunds result from refundable tax credits. A refundable credit can reduce your tax bill below zero, meaning you can get money even if you owed little or no tax. The most common example is the Earned Income Tax Credit (EITC).
I have heard of the EITC. How does it work?
The EITC is a refundable federal tax credit designed to support low- to moderate-income workers, especially those with children. You may qualify if you have earned income from work, fall within certain income limits and meet basic deposit and residency requirements. (For example, you generally can’t claim the EITC if you’re married filing separately.)
The value of the credit depends on your income, filing status and number of qualifying children. The credit increases as income increases, then decreases and finally is phased out as income increases. It is designed to reward work while targeting benefits to those in financial need.
For many eligible families, the EITC can be worth several thousand dollars, making it one of the largest items that affect your tax refund.
I understand that this can be a lot of money. Should I be worried about tax refund scams?
Absolutely. Tax refund scams are designed to steal your money, identity or refund, with the scammer pretending to be the IRS, a tax preparer, a bank or even your employer.
In a common variation, scammers pose as the IRS via email, text, phone or letter, claiming there is a problem with your refund, that you need to verify information, or that you owe a small amount to release your refund. Remember: the IRS doesn’t initiate contact via email, text, or social media—and it doesn’t require immediate payment or the threat of arrest.
How can I protect myself?
Be smart. Use strong passwords and two-factor authentication for tax software, and be careful when choosing your tax professional—always verify credentials. Check the information through official channels, including the IRS website. And if you’re expecting a refund, the IRS encourages early filing to reduce the risk of identity theft.
OK, after submitting the application, how long will it take to receive the tax refund?
The IRS says most returns filed online will receive direct deposit refunds within 21 days. Paper audits take longer (the IRS has largely discontinued paper audits, but instructions on how to application for resignation will be available on letters issued when the IRS does not receive direct deposit information) . However, some credits—like the EITC or Additional Child Tax Credit—legally delay refunds until mid-February.
How can I check the status of my tax refund?
The best and safest way to check the status of your federal tax refund is directly through the IRS. Where is the refund? The tool is available at irs.gov or through the IRS2Go mobile app. You’ll need your Social Security Number (or ITIN), your filing status, and the exact refund amount that appears on your return. Refund status usually appears within 24 hours of acceptance for returns submitted by email and approximately four weeks after a paper return is mailed. The tool is updated once a day, usually overnight.
If I don’t get my refund when I expect it, should I call the IRS?
Good luck getting through. It’s tough on the best of days—and even tougher during tax season. That said, calling generally only makes sense if it’s been more than 21 days since your e-mail submission, more than six weeks since your return was mailed, or the Where’s My Refund? The tool specifically tells you to call. Before this point, call agents usually won’t have any more information than the tool already displays.
What else should I know?
There’s more information about this tax filing season, so check back with Forbes. To make it easy, I recommend signing up for our free tax newsletter—so the information you need is in your inbox every Saturday morning.
