WASHINGTON (dpa-AFX) - As the U.S. tax season kicks off, millions of Americans are poised to receive significantly larger tax refunds as a result of the Working Families Tax Cuts Act passed last year, according to the White House.
'President Trump's Working Families Tax Cuts Act provides broad-based tax relief for hardworking Americans, with the average taxpayer expected to see nearly $4,000 in total tax savings in 2026,' the White House said. 'Key provisions of the bill include No Tax on Tips, No Tax on Overtime, No Tax on Social Security, a deduction for auto loan interest on Made-in-America vehicles, and much more - putting more money back in the pockets of families, workers, and seniors,' it added.
The legislation is delivering the biggest tax refund season ever, with average refunds projected to rise by $1,000 or more this year due to the Trump administration's transformative policies, the White House said, quoting multiple media reports.
The average refund in 2025 was $2,939, IRS data showed. This year, refunds could be as much as 30 percent more due to new provisions from President Donald Trump's mega tax and spending bill, according to James Knightley, chief international economist at Dutch bank ING.
Total taxpayer savings could amount to an additional $50 billion through bigger tax refunds or a cut in their 2026 taxes, CBS News reported quoting an analysis from Oxford Economics. $50 billion boost in tax refunds would represent an 18 percent increase from the $275 billion in refunds the IRS sent this year to nearly 94 million taxpayers who overpaid on their 2024 federal tax returns, according to the analysis.
The Wall Street Journal says refunds on average are expected to come in $1,000 higher than usual this year, according to a study by investment firm Piper Sandler.
The Tax Foundation estimates that the average tax refund will grow from $3,052 in 2024 to $3,800 for tax year 2025. 'Depending on your income and circumstances, you might get even more back.'
'Overall, we're expecting these changes to increase refunds by 15% to 20% on average,' CNBC quoted Heather Berger, a U.S. economist with Morgan Stanley, as saying.
The Working Families Tax Cuts Act, often referred to as part of the 'One Big Beautiful Bill', was signed into law on July 4, 2025. It was designed to make permanent many of the tax law changes from the 2017 Tax Cut and Jobs Act and took effect for the 2025 tax year.
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