Treasury Secretary Scott Bessent said Americans could see unusually large tax refunds in the next filing season, citing tax cuts included in President Donald Trump’s One Big Beautiful Bill Act (OBBBA).
Speaking on the “All-In Podcast,” Bessent — who is also serving as acting IRS commissioner — explained that the law’s tax provisions apply retroactively to the start of the year. Because most workers did not adjust their paycheck withholdings after the bill was signed in July, he said many households are likely to receive sizable refunds when they file in 2026.
“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,” Bessent said. “Depending on the number of workers in a household, refunds could be in the range of $1,000 to $2,000.”
His comments align with a recent analysis from the Tax Foundation, a nonpartisan tax policy organization. In a December report, the group said refunds are expected to be larger than usual because of the OBBBA’s tax cuts for 2025.
According to the Tax Foundation, the legislation reduced individual taxes by an estimated $144 billion for 2025. Outside estimates suggest that as much as $100 billion of those savings could be reflected in higher tax refunds. While not every taxpayer will see a dramatic increase, the organization said average refunds could rise by as much as $1,000.
The foundation noted that the IRS did not update withholding tables after the law passed. As a result, many workers continued to have more tax withheld from their paychecks than required under the new rules. Instead of receiving the benefit gradually through higher take-home pay, most taxpayers are expected to receive the savings in a lump sum when they file their returns.
The Trump administration has described the upcoming refund season as potentially the largest on record. The Tax Foundation also outlined several provisions in the OBBBA that could contribute to higher refunds, including a larger child tax credit and standard deduction, an increased cap on the state and local tax (SALT) deduction, and new or expanded deductions for seniors, auto loan interest, tip income, and overtime pay.
