Acting IRS commissioner Scott Bessent has announced a “gigantic” tax refund for millions of Americans due to President Donald Trump’s One Big Beautiful Bill Act.
Millions of Americans filing their 2025 federal tax returns this spring are receiving significantly larger refunds than in previous years, with Treasury Secretary Scott Bessent predicting what he called a “gigantic” refund season.
Bessent, who also serves as the acting commissioner of the IRS, made the remark during a recent podcast appearance, telling the hosts that tax provisions in President Donald Trump’s One Big Beautiful Bill Act applied retroactively to the beginning of the year, and that because most workers did not adjust their withholding, many can expect sizable refunds in 2026.
Congress passed major tax reform last year through the One Big Beautiful Bill Act, which made many of the expiring provisions of the 2017 Tax Cuts and Jobs Act permanent, including lower individual income rates, wider tax brackets, and a larger standard deduction.
The core reason for the outsized refunds comes down to timing.
After the legislation passed, the IRS did not update withholding tables for 2025. Employers use those tables to determine how much income tax to pull from employee paychecks, and by using the original tables, many workers over-withheld taxes throughout the year — setting the stage for larger-than-usual refunds come filing season.
As of early March, the average refund amount for individual filers stood at $3,676, up from $3,324 approximately one year ago, according to IRS data reflecting roughly 60.7 million individual returns out of approximately 164 million expected through the April 15 deadline.
The Tax Foundation estimated that the average tax refund would grow from $3,052 in 2024 to approximately $3,800 for tax year 2025, though individual circumstances could push that figure higher for some filers.
Several new deductions are contributing to the bump.
The SALT deduction limit has been raised to $40,000, a major increase that benefits residents in high-tax states, while seniors aged 65 and older can now claim an additional $6,000 deduction without itemizing.
As of early March, more than 27.5 million returns — nearly 45% of filings — had claimed at least one of the new tax breaks on Schedule 1-A, a new form that includes deductions for overtime pay, tip income, seniors, and auto loan interest.
Not everyone will see an equally dramatic increase.
Refund size is expected to vary considerably depending on taxpayers’ unique circumstances, including income level, marital status, whether they claim dependents, and which new deductions apply to their situation.
IRS officials have clarified that the projected increase in refunds is linked to the unique timing of recent tax law changes, and that once withholding systems fully reflect the updated tax rates, future refunds are expected to return to more typical levels.
Taxpayers who filed electronically with direct deposit can generally expect to receive their refunds within 21 days of the IRS accepting their return.
