IRS Distributing $2,945 in Average Refunds: Find Out If You’re Eligible Next Week!

As the tax season wrapped up in April, many Americans who have overpaid their taxes to the Internal Revenue Service (IRS) are starting to receive their tax refunds this month. Historically, about two-thirds of taxpayers receive refunds each year. Over the next few weeks, the IRS will continue to distribute these refunds, so keep an eye out to see if you might be among those receiving one soon.

Possible Delays in Receiving Your Refund

While many are anticipating their refunds, some individuals might experience delays. A common reason for a delayed refund is outstanding debts to the IRS or other federal agencies. For instance, if you’ve settled your federal taxes but have unpaid state taxes, the IRS may hold your federal refund until those state taxes are paid.

Other factors that could cause your refund to be withheld include unpaid federal student loans or outstanding child or spousal support payments. If you find yourself in this situation, it is crucial to contact the Bureau of the Fiscal Service (BFS) under the U.S. Department of the Treasury to figure out your next steps regarding any debts you owe.

Anticipating Tax Refunds Next Week

Filing your taxes can be done in two primary ways: electronically or by sending in a paper return. Typically, electronic filings lead to faster processing times. Refunds from electronic filings are generally issued within 21 days, often closer to just three days. If you filed your taxes electronically at the end of April and opted for direct deposit, you might see your refund arrive next week, right around the 21-day mark.

To track your refund, you can use the IRS’s “Where’s My Refund?” tool. As of April 25, the average refund issued this year was $2,945. If you’re expecting a refund but haven’t received it yet, this tool will help you check the status of your refund or confirm whether you should expect one at all.

“If you think there was an error with your refund, check ‘Where’s My Refund’ or your online account for details,” the IRS website advises.

Strategies to Reduce Your Tax Bill

If the IRS is withholding your refund due to outstanding tax debts, consider strategies to minimize your tax liability for the upcoming year. One effective approach is to ensure you’re applying for all relevant tax credits for which you are eligible. By doing so, you can significantly reduce your taxable income.

Additionally, if you have multiple assets or income sources, explore further options to reduce your tax obligations. Taxpayers with various assets might consider claiming a capital loss to lower their overall tax liability. Remember, it’s crucial to file your income taxes even if you can’t pay in full to avoid additional penalties and fees that increase your tax liability.