Individual tax refunds this year have been only slightly smaller than last year, but those shortfalls are adding up. At the end of last month, the amount of money the government refunded was $6 billion below this time last year, according to IRS figures.
As of March 29, the Treasury had issued 71.8 million refunds. This time a year ago it had issued 73.4 million. So while the average refund, at $2,873, is only $20 less than it was last year, about 1.6 million fewer people are getting refunds, the IRS said.
That shrinking pot of money is showing up in surprising ways, including through. Many families use refunds as a forced saving mechanism, as their IRS refund is often largest single check they receive all year. In the weeks after receiving a refund, families tend to splurge on large purchases such as furniture or appliances; credit-card payments and travel, a JPMorgan Chase study found.
Lower refunds don’t mean Americans paid more taxes—quite the opposite. Most workers paid less in taxes last year and saw higher take-home pay week in and week out. But for many Americans, a slightly higher paycheck doesn’t quite have the same visibility as a single $3,000 check in March or April.
- The vast majority of Americans don’t think they got a tax cut from the 2017 Republican bill.
- Just 17% of people believe their own taxes will go down, the NBC News/Wall Street Journal Poll finds.
- Republicans are the only group in which 30% or more believe they’re getting a tax cut.