IRS Tax Refund Will Be Smaller This 2023 – Here's Why

The IRS tax refund has much-awaited payment returns, with the Internal Revenue Service saying that it has received around 19 million filings through February 3.

The IRS started accepting tax refunds for the 2022 tax year on January 23. During that period, the government agency has issued about eight million IRS tax refunds to filers, as cited by CBS News.

The IRS and the U.S. Treasury Department data noted that more taxpayers are filing their returns earlier this year.

Bank of America analysts projected that more filers are submitting their returns sooner to get refunds faster due to the current economic environment.

The current inflation is considered to be the highest inflation in 40 years and has affected many Americans, with one study noting that three-quarters of families are cutting back on non-essential buys to save costs.

IRS tax refund filers can start checking on the status of their refund within 24 hours after e-filing the tax year 2022 return.

if the filing is done on paper, the status availability would be within four weeks.

What's the Average IRS Tax Refund Amount?

The IRS informed taxpayers that they could get a smaller refund this year. The average refund has dropped from an average of $2,201 in 2022 to $1,963 in just the first few weeks of the 2023 ax season.

Many taxpayers may find their refunds somewhat lower this year due to tax law changes, such as the end of the Advance Child Tax Credit and no Recovery Rebate Credit.

The IRS also offers free filing services to those making under $73,000, which is available in Spanish and English.

It will ask the taxpayers to provide their bank account information so that their tax refunds can be sent through direct deposit.

IRS Acting Commissioner Doug O'Donnell encourages all those who e-file to provide their bank details as using direct deposit helps get refunds to taxpayers faster.

It also reduces issues about stolen checks and other types of theft.

The IRS also allows taxpayers to monitor their refund using the Where's My Refund tool.

IRS Tax Refund Payments

The IRS has advised filers to wait on filing their federal income tax return if they are one of the millions of taxpayers who received a one-time tax payment from their respective states as the agency is still determining whether the payments should be treated as taxable income.

The IRS said in early February that it was working with state tax officials and expected to provide more guidance "for as many states and taxpayers as possible," according to The New York Times.

The state of California distributed "middle-class tax refund" to around 17 million taxpayers. The middle-class tax refund was worth up to $1,050 for relief against rising prices.

A spokesman for California's Franchise Tax Board said that those payments do not need to be claimed as income on California state income tax returns.

A total of 18 states sent one-time income tax rebates in 2022 including Colorado, Georgi, Hawaii, New Mexico, and Virginia, among others.

This article is owned by Latin Post.

Written by: Mary Webber

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