Key statistics launched by the IRS for the week ending February 2, 2024, reveal notable shifts in tax return filings, processing, and refunds. The 2024 tax season opened on January 29, a few week later than final yr, and consequently, much less taxpayers have been capable of file their tax return.

The discount in filings is shedding gentle on potential shifts in taxpayer habits, financial elements, or the implications of tax coverage modifications. The IRS’s readiness to deal with the season successfully, regardless of fewer returns, signifies a well-prepared system, but the decrease quantity of filings and decrease tax refund quantities elevate questions concerning the broader tax submitting panorama.

Associated: When To Anticipate My Tax Refund In 2024

Lower In Tax Returns Filed

Despite the fact that tax season formally began on January 29, 2024, many early filers usually begin making ready their returns in early January. So even with the late begin, the virtually 20% decline is troubling.

In 2023, by February 3, People had filed 18,946,000 tax returns. This yr, by February 2, People had solely filed 15,318,000 returns. That 19.1% lower is probably going a mixture of the late begin to tax season, and issues about potential modifications.

That is highlighted within the returns filed by tax preparers. Many tax preparers have famous they’re ready on Congress to resolve the excellent points across the potential retroactive tax modifications (together with the Baby Tax Credit score). Consequently, {many professional} tax preparers are ready to file their shoppers’ returns. 

Decrease Refunds For Taxpayers

The substantial decline within the whole quantity refunded and the common refund quantity is a crucial focal point. This shift may affect particular person monetary planning and spending, reflecting broader financial situations and tax coverage modifications.

Up to now in 2024, the common tax refund quantity is right down to $1,395, versus $1,963 this time final yr. That is a 28.9% decline. We anticipated tax refunds to be smaller this yr resulting from many tax credit expiring, however that is considerably greater than anticipated. Moreover, the full variety of refunds is down 67.3% general.

This discount may have wider implications for particular person monetary planning and financial exercise, as refunds typically contribute to shopper spending.

Trying Forward

Because the 2024 tax season unfolds, this early knowledge from the IRS serves as an important indicator of the season’s trajectory and the evolving tax submitting surroundings.

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