Although no new stimulus checks will be issued, stimulus payments may result in customers receiving larger refunds this year. This year’s average refund has been higher than last year’s. It’s thought that a link between stimulus checks and tax returns is causing consumers to get bigger refunds.
The tax filing season began on January 24 this year, and the deadline to submit is April 18. Last year, the ARP Act provided qualified beneficiaries with nearly $1,400 in stimulus funds. The $1,400 stimulus check was an advance tax credit, the same as the previous stimulus checks.
Americans Claiming Stimulus Checks From 2021 Could Be A Reason
Those who did not receive stimulus funds last year might claim them this year by completing a tax return.
Experts believe that persons claiming unpaid stimulus money is a factor in this year’s higher average refund amounts.
The IRS has disclosed tax return statistics, revealing that it had processed more than 33 million returns. The average return amount granted thus far is $3536, compared to $2880 last year. It means that taxpayers will receive $656 more in their tax refunds this year on average.
It’s worth noting that $656 is an average amount, which means that many taxpayers would have received a lesser return, while others would have received no change, and others would have received a larger refund than the average.
The ARP Act increased the CTC from $2K to $3.6K for children under the age of six, and up to $3K for teens, in addition to the stimulus check. The initial CTC was only partially refundable. Now, with the increased CTC, the entire amount is refundable.
Furthermore, families or people who counted a dependent in 2021 may not have claimed the appropriate stimulus payment (stimulus check, dependent payment, or CTC) the previous year. They are qualified to get the funds this year, which is another potential reason why the avg return amount has been significantly higher this year.
This average refund amount could likely get bigger or even smaller as the agency processes more returns.