March Tax Season Refunds are Down This Year
The numbers are in for the month of March filing season!
Electronic filing has been steadily increasing in popularity over the last few years, as more and more taxpayers take advantage of its efficiency. E-filed returns are processed more quickly than paper returns and the IRS issues refunds for complete and accurate e-filed returns within three weeks -- up to double the time required when filing a paper return.
For 2022, 37,049,000 people have requested a direct deposit refund while approximately two million more taxpayers have opted to directly deposit their refunds in 2023 -- making the total 39,907,000 and marking a notable 7.7% change from the previous year. With e-filing available and ever increasing popularity, it looks like taxpayers are increasingly going this route to get their refunds faster.
This year, there has been a slight uptick in the total number of tax returns filed, with 54,948,000 returns submitted – 0.4% more than last year’s 54,741,000. However, each return is netting much less for taxpayers than before; the average refund amount of $3,028 is an 11% decrease from 2022’s $3,401.
Many tax credits such as the Child Tax Credit, Earned Income Tax Credit and Child and Dependent Care Credit returned to pre-pandemic amounts, which could explain why refunds were lower. Further decreases could result from the elimination of the above-the-line charitable deduction. These changes signal a shift in how taxpayers may approach their filing process come tax season.
Check out the table below for the comparison of March 4th, 2022 and March 3rd, 2023.
|
Return/Refund Category |
2022 |
2023 |
% Change |
|
Total returns received |
54,741,000 |
54,948,000 |
0.4 |
|
Total returns processed |
53,053,000 |
54,341,000 |
2.4 |
|
Total e-filing returns received (may not equal subtotals due to rounding) |
53,216,000 |
53,598,000 |
0.7 |
|
E-filing returns received from tax professionals |
24,201,000 |
25,210,000 |
4.2 |
|
E-filing returns received from self-prepared |
29,015,000 |
28,387,000 |
-2.2 |
|
Web usage, IRS.gov visits |
357,372,000 |
289,829,000 |
-18.9 |
|
Total number of refunds |
37,999,000 |
42,040,000 |
10.6 |
|
Total amount refunded |
$129.228 Billion |
$127.310 Billion |
-1.5 |
|
Average refund amount |
$3,401 |
$3,028 |
-11.0 |
|
Total number of direct deposit refunds |
37,049,000 |
39,907,000 |
7.7 |
|
Total amount refunded with direct deposit |
$128.248 Billion |
$124.305 Billion |
-3.1 |
|
Average direct deposit refund amount |
$3,462 |
$3,115 |
-10.0 |
Source: irs.gov
