The average tax refund this year — and what to do with yours (2024)

The IRS reports that, as of March, 8, 2024, it had received about 62.8 million tax returns and refunded $135.3 billion to U.S. taxpayers.

That's 7.4% less money than it gave back compared to the same time in 2023. But the average individual refund is already higher than it was last year.

So far in 2024, the average federal income tax refund is $3,145 — an increase of just under 6% from 2023.

There's still more than a month before Tax Day but there's good reason to think 2024 refunds will be larger overall: To adjust for inflation, the IRS raised both the standard deduction and tax brackets about 7%. That put some people into lower brackets and let taxpayers who weren't itemizing deduct more of their taxable income.

A Qualtricssurvey conducted for Intuit Credit Karma in January 2024 found that more than a quarter (27%) of taxpayers expecting a refund predicted it would be larger than the one they got in 2023.

For most Americans, the tax filing deadline is April 15, 2024. You can hire a tax professional or do them yourself, but the IRS's free e-filing platform, Direct File, is only available in 12 states and other no-cost online options have income and deduction limitations.

Fortunately, there are great tax software programs that address a variety of tax situations. Most guarantee their work, but TaxAct's accuracy policy is a standout: If the program makes an error or you don't get the biggest refund possible, TaxAct will refund your software costs and pay the difference from your lower refund or higher tax liability up to $100,000. (It also includes any legal fees and audit costs.)

If you filed an electronic return and enrolled in direct deposit, you should get a refund within 21 days of filing, according to the IRS, as long as there are no issues with your return.

If you mailed a print return or filed an amended return, it will take at least four weeks for your refund to be processed.

To check your refund status, you can use the IRS' Where's My Refund? tool. You'll need to input your Social Security number, filing status and the refund amount listed on your return. The site is updated overnight, so checking it once a day is plenty.

Over a third (37%) of taxpayers expecting refunds say they'll use at least some of it to pay for rent, groceries and other necessities — and another 34% will pay down debts. If you're carrying a credit card balance, prioritize paying it down with your refund to free yourself fromhigh-interest debt.

Otherwise, you can deposit your refund into a high-yield savings account, where it could earn an APY of over 5% while still being readily available in an emergency. The Lending Club High-Yield Saving Account has one of the highest yields on the market and it doesn't carry a monthly maintenance fee or a minimum balance requirement beyond the initial $100 deposit.

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So far, the size of the average tax refund in 2024 is outpacing that from the year prior. If you're among the millions of Americans getting something back from the IRS, make the most of it — either by paying down debt, depositing it in an interest-earning account or using it to help finance a major purchase.

Even if you don't expect a refund, don't delay in submitting your return. If you file late, you could be hit with penalties and interest, and the last thing you need to do is give the government more of your money.

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