IRS leaders predict biggest tax refunds ever

Trump administration officials are confidently forecasting that Americans will see the largest tax refunds next filing season thanks to the tax cuts in the One Big Beautiful Bill Act that was passed in July and the decision not to change withholding tax tables this year.

"I can see that we're going to have a gigantic refund year in the first quarter because working Americans did not change their withholdings," said Treasury Secretary and acting IRS commissioner Scott Bessent on the All-In Podcast last week. 

Depending on the number of workers, households could see $1,000 to $2,000 more in refunds, he predicted. "They will change their withholding schedule at the beginning of the year, and they will get an automatic increase in real wages, so I think that's going to be a very powerful combo of corporate and individuals," Bessent added, referring to provisions on the corporate side such as immediate expensing of equipment purchases. He noted that the OBBBA includes provisions on the individual side such as tax deductions for tips, overtime and automobile loans for American-made vehicles.

Kevin Hassett, director of the White House's National Economic Council, made a similar point. "What we're seeing is that people have no tax on tips, no tax on overtime, no tax on Social Security," he said. "All of those folks didn't have their forms changed this year because the IRS didn't have time to do it, since we passed the bill in July, and so they're going to get huge tax refunds in the first and second half of the year."

President Trump also recently predicted the largest tax refunds ever. "Under these cuts, many families will be saving between $11,000 and $20,000 a year, and next spring is projected to be the largest tax refund season of all time."

IRS CEO Frank Bisignano, who is also commissioner of the Social Security Administration, recently made a similar prediction last week on Fox Business. 

"We should expect exactly what the President said, as always happens," said Bisignano. "The great leadership of the Treasury secretary has positioned us to be able to deliver in a whole bunch of ways for America. You're going to look at probably 94%-plus of middle-class Americans getting a boost. You'll look at tax rates coming down and getting the benefit going forward. You see all our Social Security recipients can get up to a $6,000 benefit, as he committed to the benefits of Social Security not being taxed. It will be the biggest refund that we've ever seen."

He and Bessent also pointed to the upcoming Trump Accounts, which will provide a $1,000 investment in savings accounts for American citizens born between 2025 and 2028. The IRS plans to roll out the program in July and has developed a new form allowing parents and legal guardians to sign up for new Trump Accounts for eligible U.S. citizens. The money will remain tax-free until it's withdrawn after the age of 18.

According to an analysis by the Tax Foundation, average tax refunds will be up between $300 to $1,000 compared to a typical year, but the size of the average tax refund will vary significantly depending on the taxpayer's circumstances. In the past two years, over 100 million taxpayers received tax refunds averaging a little over $3,000, according to IRS statistics.