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By Suzanne Blake
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Millions of Americans are seeing larger federal tax refunds this year, with the average refund topping $3,700 midway through the 2026 filing season, according to new data from the Treasury Department and the Trump administration.
White House press secretary Karoline Leavitt said the increase reflects the early impact of newly enacted tax provisions backed by President Donald Trump. This includes exemptions for overtime pay and tips, enhanced deductions for seniors, and other new benefits that took effect for the 2025 tax year.
Why It Matters
The higher‑than‑average refund puts thousands of dollars back into household budgets at a time when many Americans are still grappling with elevated living costs, including housing, food, and transportation.
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An average refund topping $3,700 means millions of taxpayers may see a larger one‑time cash boost over last year, which can be used to pay down debt, cover everyday expenses, or rebuild savings after years of inflation pressure.
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What To Know
Treasury and Internal Revenue Service (IRS) figures show that nearly 63.5 million tax returns have been processed so far, representing about 45 percent of the total returns expected by the April 15 filing deadline.
According to the Treasury Department, the average federal refund so far this filing season is more than $3,700, slightly higher than during the same point last year. In comparison, the IRS reported that the average refund in the 2025 filing season was just over $3,100, though refund amounts typically fluctuate as the season progresses and more complex returns are processed
Kevin Thompson, the CEO of 9i Capital Group and the host of the 9innings podcast, cautioned taxpayers from expecting too hefty a tax refund, however.
“I’ve looked at multiple 1040s already this season, and the results aren’t nearly as dramatic as the headlines suggest,” Thompson told Newsweek. “The refunds are from over-withholding and less to do with a slight change in the tax code. The real evidence shows itself when you compare '24 and '25 tax returns on the same level of income. The savings are inconsequential.”
He said while there may be some benefits within the One Big Beautiful Bill Act, it’s not “nearly as powerful as advertised.”
“Most of the real advantages are directed toward small to mid-size business owners, not the everyday household filing a standard return,” Thompson said.
New Tax Breaks
Treasury data reviewed by the administration show that more than 27.5 million filers have claimed at least one of the new tax provisions enacted under Trump’s One Big Beautiful Bill Act, which was signed into law in July 2025.
The full data shows:
- More than 15.5 million returns have claimed the “No Tax on Overtime” provision
- Over 3.5 million returns have claimed the “No Tax on Tips” exemption
- More than 9.2 million returns have claimed an enhanced deduction for seniors
- About 690,000 returns have claimed a new deduction for car loan interest
Many of these provisions allow eligible workers and retirees to exclude certain types of income from taxation, increasing take‑home pay or boosting refunds for those who had taxes withheld throughout the year.
“Senior citizens are typically the first to file their tax returns, so early refund numbers are skewed towards the older, retired demographic,” Drew Powers, the founder of Illinois-based Powers Financial Group, told Newsweek.
This year has also brought the rollout of new “Trump Accounts,” a government‑created investment program for children under 18, included in the 2025 legislation.
According to Treasury figures, nearly 3.5 million accounts have been opened so far, with more than 800,000 qualifying for a $1,000 pilot contribution from the federal government
The accounts were created to function as long‑term investments for minors, funded through a combination of federal seed money, family contributions, and, in some cases, deposits from employers or nonprofit organizations.
What People Are Saying
Alex Beene, a financial literacy instructor for the University of Tennessee at Martin, told Newsweek: “Given all the tax credits and deductions made under the One Big Beautiful Bill Act, there's little surprise Americans are on average seeing higher tax refunds this year. Most of the boost is coming from reductions on taxation over tips and overtime under certain amounts, and the senior tax credit, all of which are adding to the refunds taxpayers typically see this time of year.”
“At the same point, a higher refund is not guaranteed, and for tens of millions who have yet to file, they need to make sure they run the numbers on their personal tax situation before celebrating a larger refund that may not come.”
Kevin Thompson, the CEO of 9i Capital Group and the host of the 9innings podcast, told Newsweek: “You may receive some money back, but it likely won’t be life changing. The amounts people are seeing are generally much smaller than what was initially projected.”
Michael Ryan, a finance expert and the founder of MichaelRyanMoney.com, told Newsweek: “A big refund isn't a win, just proof you overpaid. Getting $3,700 back feels great if you live paycheck to paycheck. But financially, it means you could have had more cash in each check instead of waiting for April. The 'record refund' headline hides the fact that you loaned the government money for 12 months interest-free.”
What Happens Next
While the average refund amount is higher, the IRS says refund timing still depends on how taxpayers file.
Filers who submit returns electronically and choose direct deposit may receive refunds in about three weeks, while paper filers may wait six weeks or longer.
Taxpayers can track the status of their refunds using the IRS’s online “Where’s My Refund?” tool, which requires a Social Security number, filing status, tax year, and the expected refund amount.
“While the larger refund checks are welcome news for many Americans, they come at a time when that additional income is needed,” Beene said. “With inflationary pressures already weighing on most households and now higher gas prices, many Americans need additional funds to cover the cost of living.”
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