(NewsNation) – It’s Tax Day, and taxpayers have until midnight to file or request an extension.
Most people are seeing their refunds increase by about 11% this year, with an average refund of $3,500 — and more people are getting refunds. The IRS issued nearly 70 million tax refunds through April 4 compared to nearly 68 million at that point last year and about 66.8 million in 2024.
How to file a tax extension and avoid IRS penalties
Thanks to changes in President Donald Trump’s “One Big Beautiful Bill,” there are new deductions for seniors, tip income, overtime pay and car loan interest, generating a $775 boost to the average refund, according to the IRS.
Tax returns could help Americans struggling with high costs
But with higher prices at the gas pump and the grocery store, many Americans may not feel the boost to their bottom line. According to AAA, a gallon of regular gas now costs $4.11 on average nationwide. Grocery prices are up nearly 2% compared to last year, according to the Bureau of Labor Statistics.
Still, there is hope that bigger refunds will give the economy a much-needed boost.
Subway offering BOGO footlong subs for Tax Day
People receiving larger refunds could help drive the economy, as about two-thirds of economic growth is driven by consumer spending.
What happens if I miss the income tax filing deadline?
The IRS estimates more than 20 million people will miss Wednesday’s filing deadline.
Taxpayers who need more time can avoid penalties by requesting an extension. It’s a straightforward process that gives filers an extra six months — until Oct. 15 — to submit their return without penalties, as long as the extension is filed by April 15.
But an extension only delays the paperwork, not the bill: Any taxes owed must still be paid by April 15 to avoid penalties and interest.
NewsNation’s Andrew Dorn and Ashley Soriano contributed to this report.
