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IRS Data Show Bigger 2026 Tax Refunds After 2025 Law

Retroactive tax cuts under a 2025 law pushed refunds higher.

Overview

  • IRS week-nine filing data report $221.7 billion in refunds issued, up from $195.2 billion in 2025 and $185.6 billion in 2024.
  • The average refund hit about $3,521, with only a small rise in the number of refunds, so the increase reflects larger checks rather than many more checks.
  • The jump tracks to the 2025 One Big Beautiful Bill Act, which raised the Child Tax Credit, boosted standard deductions, and excluded tips and overtime from tax for many workers.
  • Because employers largely kept pre-law withholding tables through 2025, many people overpaid during the year and are now getting that money back at filing.
  • Advisers recommend using larger refunds to pay high-interest debt or build a bigger emergency fund, and they suggest filing a new W-4 to adjust withholding going forward.