Americans are worried they’ll get smaller tax refunds this year — unfortunately, they’re onto something
This year, there’s anxiety mixed with that anticipation, according to a survey released Tuesday.
• Another concern was processing delays and the potential of rising interest rates cutting into their refund’s purchasing power.Chance of smaller refunds The 2022 tax season, which started Jan. 24 and ends April 18, comes after the IRS paid out the first half of the enhanced child tax credit. “Many Americans will get smaller refunds this year because they already got half of their child tax credit funds in monthly installments during the second half of 2021,” Ted Rossman, senior industry analyst at Bankrate.com, said in a statement. It was “no wonder” that millennials and parents with kids under age 18 were most likely to say they were worried about the size of their refund, he added.
If prices keep drifting up, that means the refund goes a little less far. And if the Federal Reserve increases interest rates — which many expect to happen beginning in March — other increased borrowing costs reach the consumer. That includes higher annual percentage rates on credit cards, which make it more costly to carry a balance month to month.
Delayed tax refunds Another top worry in the Bankrate.com survey has to do with the chance for IRS processing delays. Even before tax season started, the IRS was warning people there could be headaches and lags turning around refunds.