The average tax refund is climbing in 2026, but new tax policies and deductions are widening the gap between who benefits and who does not.
Tax refunds are rising this year, but not as much as some policymakers had anticipated.
According to the latest Internal Revenue Service data released Friday, the average refund is up 10.9 percent compared to the same period last tax season.
Individual filers have received an average of $3,571 so far, an increase from $3,221 a year ago, based on roughly 79 million returns processed. The IRS expects about 164 million filings by the April 15 deadline, according to CNBC.
The increase reflects recent tax changes backed by President Trump, which expanded certain deductions tied to income like tips, overtime pay, and auto loan interest. But early expectations that those changes would significantly increase refunds for the typical filer have not fully materialized, CNBC reported.
In a March testimony before the House Ways and Means Committee, IRS Commissioner Frank Bisignano said some taxpayers claiming the new deductions, reported on Schedule 1-A, were seeing refunds roughly $775 higher than last year, according to CNBC. Still, those gains appear uneven and concentrated among a narrower group of filers.
The size of tax refunds has taken on added political weight as both parties confront voter frustration over the cost of living ahead of the November midterm elections. For many households, refunds function as a once-a-year cash infusion, making even modest changes feel consequential.
At this stage in the filing season, economists say a dramatic shift in average refund size is unlikely. “It’s less likely we’re going to see a major change” before the deadline, William McBride, chief economist at the Tax Foundation, told CNBC.
That said, some higher-income taxpayers could still push the average upward in the coming weeks, particularly those taking advantage of the expanded state and local tax (SALT) deduction. Trump’s legislation raised the SALT cap to $40,000 by 2025, up from $10,000.
“It’s a pretty big deal for higher-income folks that live in expensive cities,” McBride said. “Those people don’t tend to file early.”
Most filers, however, may not benefit. To claim the larger SALT deduction, taxpayers must itemize rather than take the standard deduction, a step relatively few Americans take, according to CNBC. In 2022, nearly 90 percent of filers opted for the standard deduction, while fewer than 10 percent claimed SALT.
That dynamic could shift slightly this year as the higher cap incentives more itemizing. But for now, the data points to a familiar pattern. Refunds are up, but the biggest gains are likely concentrated among higher earners, and arriving later in the filing season.
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