The Internal Revenue Service (IRS) generally receives over 150 million individual returns over the tax season with more than 95% of those returns filed electronically and over 80% of those returns resulting in refunds.
Over the last few years, thanks to plenty of pandemic related stimulus payments and funding for expanded tax credits, the average refund payment has ballooned to over $3,000.
However, with the end of all this free government money, and higher employment levels it is widely expected that that the average refund will start declining over the next few years.
Tax Season (Tax Year-Filing Year) | Average IRS Refund |
|---|---|
2025-2026 (est) | $3,600 |
2024-2025 | $2,939 |
2023-2024 | $3,140 |
2022-2023 | $3,167 |
2021-2022 | $3,293 |
2020-2021 | $2,882 |
2019-2020 | $2,546 |
2018-2019 | $2,870 |
In particular, the average refund will drop with the reduction in government payments, increased standard deduction (larger paychecks, smaller refunds), charitable standard deduction elimination, and advance distribution of credits, like the expanded CTC.
Over 20 million households and dependents will not qualify for some or all of the child tax credit because of the refundability rules.
Based on various sources and pre-pandemic figures, it is expected that the average federal tax refund will be around $2500 in the coming year. The average state tax refund will also likely fall by 20 to 30 percent.
The IRS still estimates that 9 out of 10 refunds in 2023 will go out within 21 days from when a return is filed. But paper filed returns may take up to 7 weeks this year. See the latest IRS tax return processing schedule for more payment and direct deposit dates.
However there are still millions of tax payers who file their taxes on time, but continue to await receipt of their prior year refunds due to ongoing processing delays at the IRS. This is even worse when it comes to amended returns. See how to get details on your refund status or delay.
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Finally, tax fraud continues to be a big issue and the IRS has warned taxpayers to be on the look out for fake calls/correspondence and advised tax payers to e-file their returns (see best e-file options/deals) since it is the quickest, safest and most accurate way to file and the fastest way to get a refund.