NEW YORK - Expecting a tax refund? It could be smaller than last year. And with inflation still high, that money won't go as far as it did a year ago.The 90 million taxpayers who have filed as of March 31 got refunds that were an average of nearly 10% less than last year, in part due to pandemic relief programs expiring.
The filing deadline for most taxpayers is Tuesday.The average refund is $2,910, down from $3,226, a difference of more than $300, according to the most recent IRS data.For many households, especially working families, the tax refund is the biggest one-time financial windfall of the year, said Kathy Pickering, chief tax officer of H&R Block."We know that working families in general are the most cash-strapped," she said, adding that the expanded earned income tax and child tax credits during the COVID pandemic provided a lot of benefits for families with children.(Xaume Olleros/Bloomberg via Getty Images) The child tax credit, for example, is reverting to $2,000 per child, while the pandemic credit was as high as $3,600 per child.
The child and dependent care credit, a tax break available to parents and those who care for family members while they work, had been expanded to a maximum of $8,000 in 2021 and is now a maximum of $2,100."As those provisions expired, that's had a big impact," Pickering said.Rachel Zhou, 20, a college student in Boston whose father works in food delivery and whose stepmother is a social worker, said her family has used refunds in the past for things like home repairs that require big one-time payments.
One rebate they received during the pandemic went toward fixing her house's heating, air, and ventilation system, she said. Featured The tax deadline is a little over a week away,.