With tax season underway, many Americans are noticing that their tax refunds are smaller than last year. According to the IRS, the average tax refund in 2025 is $2,169 as of February 14.
This is about 32% less than the $3,207 average refund at the same time last year. The IRS started accepting tax returns on January 27 and will continue until April 15, except for those who request an extension.
Why Are Refunds Smaller This Year?
Smaller refunds at the start of tax season don’t always mean individual taxpayers will get less money back. Experts explain that low- and middle-income workers with simple tax returns tend to file early.
In contrast, people with higher incomes or more complicated taxes usually file closer to the April 15 deadline. As a result, the average refund amount is lower at the beginning of the season.
Keith Hall, CEO of the National Association for the Self-Employed (NASE), says that people who only have a W-2 form generally get smaller refunds or owe smaller amounts because their taxes are withheld throughout the year.
On the other hand, some small business owners are getting their financial documents, like dividend or brokerage statements, later than usual. This delay is causing some businesses to wait before filing their taxes.
Fewer Americans Are Filing Early
The IRS data shows that fewer people are filing their taxes in the first weeks of the 2025 tax season compared to last year.
About 33 million tax returns were filed by February 14, which is 5% less than the same period in 2024. However, the IRS expects the numbers to balance out as the filing deadline approaches in April.
When Will You Get Your Tax Refund?
If you want to get your tax refund faster, experts advise filing as soon as possible. The IRS issues most refunds within 21 days for electronic filings.
However, paper returns take longer because they must be processed manually, which could add weeks to the wait time.
You can check the status of your refund using the IRS’ “Where’s My Refund?” tool. If you filed electronically, you can check 24 hours after submitting your return.
However, if you mailed in your tax return, you’ll need to wait at least four weeks before you can check your refund status.
Why It’s Important to File Early?
Filing your taxes early has another advantage this year. Some experts are concerned that IRS job cuts could slow down the processing of tax returns.
By filing early, you can avoid potential delays and receive your refund sooner.
Read More:
- Avoid Medicare Part B Penalties: Everything You Need to Know About the General Enrollment Period
- Social Security Benefits and the 2025 Cut Rumors: What You Need to Know
What Do Most Americans Expect This Year?
According to a survey by the National Retail Federation, about half of Americans plan to file their taxes by the end of February.
The rest are likely to file in March or April. Around half of taxpayers are expecting a refund this year, despite the smaller average amounts reported so far.
Conclusion
While the average tax refund in 2025 is about $1,000 less than in 2024, this doesn’t necessarily mean everyone will receive a smaller check.
Early filers tend to be low- and middle-income workers with simpler tax situations. As more people file closer to the April deadline, the average refund amount could increase.
To get your refund faster, consider filing electronically and as early as possible.
Disclaimer- Our team has thoroughly fact-checked this article to ensure its accuracy and maintain its credibility. We are committed to providing honest and reliable content for our readers.