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The IRS kicked off the 2026 tax season Monday, and filers will see changes from President Donald Trump’s “big beautiful bill” that could affect their 2025 returns.
About 164 million individual tax returns are expected before the April 15 deadline, and many could receive bigger tax refunds after Trump’s 2025 legislation, experts say.
“The size of refunds is a major political topic” with the 2026 midterm election approaching, Andrew Lautz, director of tax policy for the Bipartisan Policy Center, a nonprofit think tank, told reporters during a call on Thursday.
Typically, a refund or balance due depends on taxes paid the previous year via paycheck withholdings or estimated payments. In 2025, the average refund for individual filers was $3,052 through Oct. 17, according to the IRS.
“There are a lot of things that are likely to drive higher refunds [during the 2026] filing season,” including 2025 tax cuts and withholdings, Lautz said.
After Trump’s 2025 tax changes, the IRS didn’t update withholding tables for employers, and many workers will see the effect of that when filing their returns in 2026.
The Trump administration has floated a number of policy ideas focused on affordability as many Americans continue to struggle with the rising cost of living.
However, more than half of Americans don’t know how Trump’s 2025 tax law changes will affect them, according to a new TaxSlayer survey, which polled 2,000 filers in November.
Here’s what taxpayers can expect during the 2026 filing season.
Which tax breaks could affect your refund
Refund size or taxes owed “will vary significantly” depending on individual circumstances, according to a Jan. 15 Tax Foundation analysis.
Trump’s 2025 tax law made permanent his 2017 tax breaks, which is “mostly continuity from the current status quo,” Garrett Watson, director of policy analysis at the Tax Foundation, a nonprofit think tank, told CNBC.
However, the legislation also included a bigger standard deduction; more generous maximum child tax credit; a higher limit for the state and local tax, or SALT, deduction; a $6,000 tax break for seniors; and deductions for auto loan interest, tip income and overtime pay, among others.
Who could see a bigger tax refund in 2026
For 2025, the standard deduction increased to $15,750 for single filers and $31,500 for married couples filing jointly, up from $15,000 and $30,000, respectively.
“That’s going to result in larger refunds for the 85% to 90% of taxpayers who claim the standard deduction each year,” Lautz said.
Another tax break that could affect many filers is the new $6,000 “bonus” deduction for seniors age 65 and up. The full deduction is available with up to $75,000 in modified adjusted gross income or $150,000 for married couples filing jointly.
Many families could also see a bigger child tax credit. For 2025, the maximum credit is $2,200, up from $2,000.
Meanwhile, the SALT deduction and tax breaks for tip or overtime income could provide “much larger” cuts, but fewer filers will qualify, Lautz previously told CNBC.
Correction: This story was updated to reflect that President Donald Trump’s 2025 tax law made permanent his 2017 tax breaks. A previous version of this story gave an incorrect year.