How Big Will Your Tax Refund Be? Many Taxpayers Have No Idea

Money; Getty Images
Money; Getty Images

Nothing in life is certain except death and taxes, but many U.S. adults apparently aren’t so clear on the particulars of the latter.

The results of a Morning Consult poll released this week found that 30% of Americans say they aren’t sure whether they’ll receive a tax refund or owe the IRS money each year. A majority of those surveyed also reported having little or no knowledge about their options to file taxes for free.

What the survey says

  • While more than half of taxpayers surveyed said they expect to get a refund check this year, only 22% said they know each year how much they’ll owe the IRS or receive as a refund.

  • Thirty percent said they weren’t sure in years past whether they would owe money to the IRS or get a refund. The same share of people said they knew whether they would owe or have a refund coming, but weren’t sure about the amounts.

  • Almost three quarters of taxpayers haven’t heard, or have heard very little, about the IRS Free File program, which is available to anyone who earns less than $73,000 annually. Among those surveyed who qualify for the program, 76% also said they know little or nothing about their options to file for free.

Why it matters

  • The IRS received a major infusion of $80 billion funding over the next 10 years, part of which will be dedicated to taxpayer services like pre-filing assistance and education. The results of the survey shows the agency has its work cut out for it — experts told Morning Consult that much of public uncertainty about the federal tax filing process is thanks to the IRS’s overly complicated tax code.

  • It seems as if the agency also has a long way to go when it comes to addressing social inequities stemming from its complex filing process: Women and lower-income Americans were the most likely to report that they don’t know whether they will owe money or receive a tax refund.

  • Many Americans rely on tax refunds to cover basic expenses, with 30% of taxpayers who expect a refund saying they’re very dependent on refund money to pay for things like groceries and housing. But refunds are getting smaller: The IRS warned taxpayers that they should expect less this year, and data shows the average refund as of February is 11% lower than what taxpayers received a year ago.

More from Money:

10 Best Tax Software of 2023

Here’s How to Track Your Tax Refund

13 Weird Things the IRS Considers Taxable, From Bribes to March Madness Pools

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