With the tax deadline approaching, the IRS has issued roughly 54 million refunds worth about $158 billion as of March 17, the agency reported Friday.
In January, the IRS warned filers that refunds may be “somewhat lower,” and so far, the prediction has been accurate for many filers.
Indeed, the average refund payment was $2,933 compared to $3,305 at the same point last year. However, the average amount may change with more returns expected before April 18, the federal deadline for most filers.
Bill Smith, national director of tax technical services at CBIZ MHM’s national tax office, said smaller refunds for 2022 are likely due to expiring pandemic relief.
“That’s the only thing I know to explain it,” he said.
For example, many families got relief in 2021 from the enhanced child tax credit, worth up to $3,600 per child, and the child and dependent care tax credit of up to $4,000 per dependent.
But those tax breaks have reverted to previous levels. For 2022, the child tax credit returned to a maximum of $2,000 per child, and the child and dependent care tax credit was $1,050 per dependent.
Further, data from the same week of the 2021 filing season shows a similar average refund to the latest data, Smith said. As of March 19, 2021, the average refund was $2,929, only $4 less from the numbers reported Friday.
How to get a faster tax refund
Although the IRS has received 0.5% fewer returns compared to last year, the agency has processed 1.6% more filings as of March 17, according to the latest report.
Generally, you can expect your refund within 21 days — assuming you have filed an electronic, error-free return with direct deposit for the payment.
“E-file whenever possible if you can,” said Eric Bronnenkant, head of tax at Betterment, a digital investment advisor, noting that paper returns have been an issue for the IRS.
You can avoid unnecessary delays by reviewing all the details on your return, including your address, Social Security number and direct deposit details, he said.
You can check your refund status with the “Where’s My Refund?” online tool or through the IRS2Go app. But you’ll need to wait 24 hours after electronic filing your 2022 return, and three to four days after e-filing 2020 and 2021 returns. Paper returns may take up to four weeks for a status update.