Tax Refunds 2023 May Be Smaller Than Last Year, IRS Warns

The Internal Revenue Service (IRS) warns taxpayers that the tax refunds 2023 may be smaller than last year’s. Reportedly, the refunds were 14% less than what was received in 2022.

The most recent weekly data from the Internal Revenue Service (IRS) revealed that tax refunds 2023 may be smaller than what was received in 2022. Based on the tax returns processed through February 10, the average tax refunds amounted to $1,997. This amount was 14% less than the $2,323 worth of tax refunds in February 2022. This amount is based on almost 13.3 million tax refunds 2023 the IRS has distributed compared to the 8.9 million refunds in 2022.

According to Ermey, several tax experts have been alerting taxpayers that the tax refunds 2023 may be smaller. This is because the tax benefits like the federal and stimulus payments from the COVID-19 pandemic era have started to end.

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Amount of  Tax Refunds 2023

According to Cruz-Martinez, the maximum amount of tax refunds 2023 have been brought back to the level of benefits before COVID-19 began. These tax credits include the Child and Dependent Care Credit, Earned Income Tax Credit (EITC), and Child Tax Credit (CTC).

The Child Tax Credit (CTC) reportedly reduced its benefits to $2,000 per dependent child. Compared to 2022, the CTC last tax season was worth $3,600. In addition, the CTC this year will not be fully refundable anymore. This means that taxpayers will not be able to receive the full amount of tax credits if the amount is more than the tax liabilities they have paid.

Furthermore, in Earned Income Tax Credit (EITC), the maximum amount of tax refunds 2023 also decreased. For eligible individual tax filers with no children, the tax credits were reduced to $500 from $1,502 in 2022. The Child and Dependent Care Credit were also reduced to $2,100 from the $8,000 in tax credits in 2022.

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