Yahoo Finance Tax refunds remain smaller than last year and fewer taxpayers got one
Tax refunds are still smaller than at the same time a year ago, according to the latest data from the Internal Revenue Service.
The agency also has doled out fewer refunds versus 2022, with less than a week left in the filing season.
The average refund amount was $2,878 as of April 7, down 9.3% from $3,175 the same period last year, the IRS reported. That’s based on nearly 69.1 million refunds the agency has distributed this year, down 1.3% from the 70 million refunds disbursed last year.
This year, 68.8% of processed returns yielded a tax refund so far, according to the data, down from 70.2% last year.
Since the beginning of this tax season, the average refund has been consistently lower than last year based on the weekly filing statistics, underscoring how the loss of several pandemic-era tax breaks translated into a smaller — and often crucial — cash infusion for many American families.
Good-bye pandemic tax breaks
The Child Tax Credit (CTC), Earned Income Tax Credit (EITC), and Child and Dependent Care Credit are back to pre-COVID levels this tax season.
Last year, taxpayers received $3,600 per child dependent for the CTC. That’s down to $2,000. The maximum EITC amount that single filers with no children are eligible for is $500 this year, down from $1,502 last year. The Child and Dependent Care Credit — which covers out-of-pocket expenses for child care and day camps — was similarly reduced this year to $2,100 from last year’s $8,000.
The loss of the above-the-line charitable deduction and the expiration of the mortgage insurance premium deduction also may have factored into lower refunds this year.
A smoother tax season
Of the 168 million individual tax returns the IRS expects this year, the agency has gotten 101 million, nearly on track with the number received last year at this time.
The percentage of received returns the IRS processed is higher than a year ago. As of April 7, the agency had processed over 100 million tax returns, a slight increase of 0.6% over the same time a year ago when it got through 99 million returns.
Another potential signal that it’s been a relatively smoother tax season this year: Visits to the IRS website are down 20.9% versus last year.
Ronda is a personal finance senior reporter for Yahoo Finance and attorney with experience in law, insurance, education, and government. Follow her on Twitter @writesronda
Read the latest financial and business news from Yahoo Finance
