What You Should Know
For the tax year 2022, the Internal Revenue Service has released previously unreleased data.
The average payout so far has been $656 more than the 2021 refund.
The additional funds may be attributable to the large number of Americans who get stimulus aid.
A total of $650 more in stimulus money was made available to the average American household.
Those who were affected by COVID-19 received significant financial aid via the American Rescue Plan Act of 2021.
The stimulus payments were made out in advance of tax credits to ensure that households received the money they needed at the time they applied for it. Throughout the year, the IRS was in charge of depositing funds into people’s bank accounts. If you don’t receive all of your refunds, you can still claim tax credits on your 2021 taxes.
There is currently a 2021 deadline, and many Americans have already submitted their paperwork. With almost 35 million returns processed, the Internal Revenue Service has made certain data available to provide an overview of its operations through February 18, 2022.
It appears that thus far in 2022, the average refund issued is much bigger than the average refund issued in 2021. Numerous explanations exist, but the fact that millions more people are claiming unpaid stimulus funds may help to explain why they are receiving an average of $650 more in refunds this year than they did the year before.
Will stimulus spending result in higher tax refunds?
This year’s average refund is $3,536 based on data from the Internal Revenue Service (IRS). Compared to 2021, this indicates an increase of $800. The average American who has submitted a tax return thus far has received an additional $656 in refund.
Obviously, some people received less or no reimbursements at all, while others received hundreds of dollars more. This is average. If the American Rescue Plan Act is passed, many people may receive substantial refunds, which would raise the IRS’s average return amount.
For example, the COVID-19 relief program provided $1,400 in stimulus payments to qualifying people and their dependents. They also doubled child Tax Credits for children under six and those over six from $2,000 to $3,600 for children under six, and from $3,000 to $4,000.
Child tax credits were previously refundable, but this year’s Child Tax Credit is entirely refundable, which means that some taxpayers will receive more money than they paid in taxes.
A total of $650 more in stimulus money was made available to the average American household.
However, if you didn’t send in a recent tax return or added a dependent to your household in the previous year, you may not have received any stimulus funds or the enhanced Child Tax Credit in 2021 since the IRS didn’t have your information on file.
If these folks have been eager to get their hands on this money, it could be one of the reasons why this year’s average refund has been larger.
Things could, however, alter because taxpayers who expect a refund are likely to have submitted their forms earlier than those who owe. If that’s the case, the big rise in average refunds in the 2022 filing season may not be sustainable.
Many Americans are receiving more money from the IRS this year than they did in 2012, according to data from the Internal Revenue Service (IRS).