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(The Hill) — Tax refunds in 2026 are projected to be larger than previous years, but they still fall short of the lofty expectations set by President Donald Trump following the enactment of his “One Big Beautiful Bill” last year, which promised significant tax relief for Americans.
According to IRS data collected prior to April 3, average refunds have increased by 11 percent to $3,462 compared to 2025’s $3,116. While there’s a 3.1 percent rise in the number of refunds issued, specifics on the total volume remain unclear.
The anticipated increase per refund was around $300, falling short of the $775 projected by the IRS and the over $1,000 that the White House had predicted in January.
The tax reform, signed by Trump last July, introduced deductions that were expected to boost refunds. These include provisions that exempt taxes on tips up to $25,000 and a senior citizen deduction to avoid Social Security taxes for those over 65. However, the actual refund amounts vary depending on individual income levels and eligibility, as reported by Axios.
More than 53 million people have taken advantage of at least one of these tax cuts, with refunds primarily used for essential expenses like rent and bills, according to Treasury Department officials cited by The New York Times. Additionally, a TurboTax survey from February indicated that 70 percent of taxpayers planned to allocate their refunds towards necessities, including rent and other living costs.
Americans who receive larger refunds could help drive the economy, though rising costs as a result of the U.S.-Israeli conflict in Iran could cancel out any stimulus generated by the president’s tax cuts, the Times reported.
But the law’s passage also left some taxpayers seeing little difference on this year’s return.
The Bipartisan Policy Center’s poll found that 38 percent of taxpayers noticed no difference from their taxes last year. Financial stress is widespread with 43 percent of women telling the think tank that they are “just getting by” or “struggling,” with 27 percent of men saying the same.
The One Big Beautiful Bill Act also made sweeping cuts to Medicaid and nutrition assistance, with federal spending previously being estimated to decrease by about $1 trillion and resulting in about 16 million low-income Americans losing their health insurance by 2034, the nonpartisan Congressional Budget Office stated last year.