US Taxpayers Filing Earlier And Banking Larger Refunds In 2009

by Mike Godfrey, for LawAndTax-News.com, Washington

10 March 2009

Taxpayers in the United States are filing earlier and receiving larger refunds so far this year, according to early filing season statistics released by the Internal Revenue Service (IRS).

As of February 27, 2009, the IRS had received 56 million individual tax returns - a slight increase over the previous year - and the average individual refund was around USD2,869 (GBP2,100); a 9% increase or USD232 (GBP167) more than the same time last year.

According to the IRS, the possible reasons for the larger refunds may include taxpayers benefiting from the recovery rebate credit and other tax breaks such as the first-time homebuyer credit and the additional standard deduction for real estate taxes.

The average refund amount generally will decrease slightly as the filing season progresses.

More taxpayers choose to receive their refunds through direct deposit each year. As of February 27, more than 84% of all refunds were issued through direct deposit, up from 81% for the same period last year.

While the IRS has issued almost 3% more refunds this year compared to the same time last year, the number of taxpayers who choose to receive their refunds quickly and safely through direct deposit is up almost 7% compared to the same time last year.

On February 27, the average direct deposit refund totaled USD3,063 (GBP2,210).

However, the IRS has cautioned that year-to-year analysis of total returns filed will be an anomaly this year because last year’s results include those returns filed for the economic stimulus payment.

As the year progresses, the IRS expects to receive and process more individual income tax returns during 2009 than in 2007 but fewer than in 2008.

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