Tax season started on Jan. 26, with many Americans expecting a bigger tax refund due to the One Big Beautiful Bill Act (OBBBA) and outdated IRS withholding tables. The average refund could be up to $1,000 higher this year. Taxpayers have until April 15 to file their 2025 tax returns.

Changes in tax law and withholding tables in 2025 could lead to larger refunds for many taxpayers this year. The OBBBA included various tax cuts, affecting federal income taxes owed. Deductions for seniors, car loans, and more could impact your refund amount. The state and local tax deduction cap has increased to $40,000.

Taxes withheld in 2025 and tax cuts themselves may lead to unexpected increases in tax refunds this year. The IRS did not update withholding tables after the OBBBA, resulting in additional deductions but the same amount withheld. The IRS issued an average refund of $3,167 for the 2025 filing season.

President Trump claimed this spring would see the largest tax refund season ever, with many families saving between $11,000 and $20,000. The actual impact on individual returns varies. High earners might be phased out from deductions, while low-income filers may not see significant differences. Seek guidance from a tax expert if unsure.

Use your tax refund wisely this year. Pay off high-interest debt or boost your savings. Having cash in an emergency fund or high-yield savings account can prepare you for the future. Track your refund status using the IRS’s Where’s My Refund tool after filing. Remember, everyone’s tax situation is unique.

Read more at Yahoo Finance: Your tax refund may be bigger this year. Here’s why.