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With the 2024 tax season well underway, the IRS is providing an early peek at the typical refund amount taxpayers can expect to receive.
The IRS said this week that it has issued about 20 million refunds as of Feb. 16, worth a collective $66.9 billion. The average refund check so far this year is worth $3,207 – about 2.1% higher compared with the same time last year.
That is in line with an earlier prediction from some tax experts, who said that refunds could end up being much bigger in 2024, with some people receiving up to 10% more than they did last year. That would amount to a roughly $300 to $400 increase.
"For anybody whose income did not outpace inflation, they should do better," Mark Steber, chief tax information officer at Jackson Hewitt, previously told FOX Business. "It's not even voodoo or marketing spin, it's pretty much just science."
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A blank 1040 tax return form from the IRS. ( / iStock)
Taxpayers typically receive a refund if they had too much money withheld and overpaid their taxes the previous year. For many families, the money can be substantial. Nearly three-quarters of filers received a tax refund in 2023, with an average payment worth about $3,176, down about 3% from the previous year.
A bigger refund can be a relief to millions of Americans who depend on the influx of money from Uncle Sam to make major purchases, save for retirement or pay off debt. On top of that, many taxpayers are still struggling with high inflation, which has sent the cost of staples like food and rent soaring higher.
The bigger refunds are a silver lining of the inflation crisis that ravaged millions of households' finances last year.
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That's because the IRS annually adjusts the federal income tax bracket and standard deduction. In times of painfully high inflation, the increases are more significant and impactful for taxpayers. In 2023, the tax brackets shifted higher by about 7.1%, a historic increase that is also higher than the 5.5% earnings increase received by the median worker last year.
Most taxpayers will have until April 15 to submit their returns or request an extension.
The IRS building in Washington, D.C., on Jan. 24, 2023. (Stefani Reynolds/AFP via / Getty Images)
The IRS expects to receive more than 128.7 million individual tax returns by this year's deadline.
To receive a refund within 21 days of filing, the IRS has cautioned filers they must submit returns electronically, ensure that they are accurate and complete, and request to receive the refund via direct deposit.
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However, the tax collection agency warned some returns may require "additional review" and take longer to process if their systems identify any errors, if there are mistakes on the return, or if it suspects theft or fraud.
"Once you're relatively certain that you have all of your tax documents, file as soon as you can so that you can start investing your money," Eric Bronnenkant, head of tax at online financial adviser Betterment, previously told FOX Business. "Because, in general, the IRS doesn't pay you interest on your refunds. So, getting that money in your hands sooner is better, for sure."
FAQs
The IRS said this week that it has issued about 20 million refunds as of Feb. 16, worth a collective $66.9 billion. The average refund check so far this year is worth $3,207 – about 2.1% higher compared with the same time last year.
What is the average amount in dollars of the average tax refund? ›
States with the largest/smallest average refunds for tax year 2021
| Rank | State | Average refund |
|---|
| 6 | Nevada | $4,884 |
| 7 | Connecticut | $4,877 |
| 8 | Texas | $4,753 |
| 9 | California | $4,671 |
6 more rowsMar 11, 2024
Which income bracket got the biggest refund?
| Income level | Average refund | % of income |
|---|
| $25,000 to $49,999 | $2,845.81 | 5.7% to 11.4% |
| $50,000 to $74,999 | $2,830.10 | 3.8% to 5.7% |
| $75,000 to $99,999 | $3,347.69 | 3.3% to 4.5% |
| $100,000 to $199,999 | $4,436.36 | 2.2% to 4.4% |
3 more rowsHow much is the average refund? So far in 2024, the average federal income tax refund is $2,850, an increase of 3.5% from 2023. It's not entirely unexpected: To adjust for inflation, the IRS raised both the standard deduction and tax brackets by about 7%.
How much tax return should I expect if I make $20,000? ›
If you make $20,000 a year living in the region of California, USA, you will be taxed $2,687. That means that your net pay will be $17,313 per year, or $1,443 per month.
How much should my tax return be if I made 70k? ›
If you make $70,000 a year living in the region of California, USA, you will be taxed $17,665. That means that your net pay will be $52,335 per year, or $4,361 per month.
What is the biggest tax refund ever? ›
Ramon Christopher Blanchett, of Tampa, Florida, and self-described freelancer, managed to scoop up a $980,000 tax refund after submitting his self-prepared 2016 tax return. He also allegedly claimed that he earned a total of $18,497 in wages — and that he had withheld $1 million in income taxes, according to a Jan.
Is it possible to get a $10,000 tax refund? ›
You could end up with a $10,000 tax refund if you've paid significantly more tax payments than you owe at the end of the year.
How to get $7000 tax refund? ›
Requirements to receive up to $7,000 for the Earned Income Tax Credit refund (EITC)
- Have worked and earned income under $63,398.
- Have investment income below $11,000 in the tax year 2023.
- Have a valid Social Security number by the due date of your 2023 return (including extensions)
If you make $100,000 a year living in the region of California, USA, you will be taxed $29,959. That means that your net pay will be $70,041 per year, or $5,837 per month. Your average tax rate is 30.0% and your marginal tax rate is 42.6%.
You may be in line for a smaller tax refund this year if your income rose in 2023. Earning a lot of interest in a bank account could also lead to a smaller refund. A smaller refund isn't necessarily terrible, since it means you got paid sooner rather than loaning the IRS money for no good reason.
Will the 2024 tax refund be bigger? ›
After a slow start to the 2024 tax season, the average tax refund this year is now up to $3,070, a 6% increase from this time in 2023.
What is the average tax return for a single person making $40,000? ›
If you make $40,000 a year living in the region of California, USA, you will be taxed $7,507. That means that your net pay will be $32,493 per year, or $2,708 per month.
What is the average tax return for a single person making $60,000? ›
If you make $60,000 a year living in the region of California, USA, you will be taxed $13,653. That means that your net pay will be $46,347 per year, or $3,862 per month.
How much will my tax return be if I made 19000? ›
If you make $19,000 a year living in the region of California, USA, you will be taxed $2,477. That means that your net pay will be $16,523 per year, or $1,377 per month.
How much will my tax return be if I make $50,000 a year? ›
If you make $50,000 a year living in the region of California, USA, you will be taxed $10,242. That means that your net pay will be $39,758 per year, or $3,313 per month.
How much will I get back in taxes if I make $15,000? ›
If you make $15,000 a year living in the region of California, USA, you will be taxed $1,518. That means that your net pay will be $13,483 per year, or $1,124 per month.
How much would my tax return be if I made $12,000? ›
If you make $12,000 a year living in the region of California, USA, you will be taxed $1,050. That means that your net pay will be $10,950 per year, or $913 per month.
