Tax refunds remain much smaller than the same time a year ago with only a month left in the filing season. The average refund amount was $3,028 as of Mar. 3, down 11% from $3,401.
Tax refunds remain markedly smaller than the same time a year ago with only a month left in the filing season, according to the latestStill, the IRS has distributed more tax refunds than last year and a greater share of processed returns yielded a refund.
“With the loss of the Child Tax Credit and Earned Income Tax Credit expansions, families and individuals are receiving smaller refunds this tax season,” Joanna Ain, associate director of policy for nonprofit Prosperity Now, told Yahoo Finance. “On average, a household pays $220 per tax return in order to file. In addition, low-income households often end up paying more for filing taxes due to the charges applied to the extra forms needed to claim tax credits.
The Child and Dependent Care Credit — which covers out-of-pocket expenses for child care and day camps — was reduced this year to $2,100 compared with last year’s $8,000. “One other factor for 2022 is that the amount of reportable capital gains generated are drastically smaller than last year, which is representative of the market volatility experienced in 2022,” Tom O’Saben, director of tax content and government relations at the National Association of Tax Professionals , told Yahoo Finance. “Lower capital gains result in lower tax obligations, which help to offset the loss of pandemic-enhanced credits.”issue early on, it has been a relatively quiet tax season.
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