Americans received higher tax refunds than expected heres what people are spending the extra cash on

Are “responsible tax refunds” on the rise? A new survey shows taxpayers are more likely to spend their refunds on rent, groceries and other necessities, rather than luxuries.The poll of 2,000 US taxpayers found nearly two in three (64%) have either already spent their tax refund money or are planning to soon.And all agree their refunds will be spent on necessary purchases.Commissioned by TaxSlayer and conducted by Talker Research, the two-part study compared Americans’ initial tax refund ambitions pre-Tax Day to their post-Tax Day realities.Four in five who have already spent their refunds spent it on essentials; top spends include bills like rent (58%), groceries (48%), paying down credit card debt (29%) and home repairs (13%). Likewise, 72% who haven’t already spent their refunds are planning to invest it all in necessities.The study revealed that participants received more than $2,300 on average in their refunds this year — higher than the average $1,700 that was predicted when the first study on this topic was conducted in December 2024.Six in 10 (61%) said their refunds are an important part of their budgeting plans for 2025; an increase from 52% who felt the same about the role refunds played in their 2024 budgeting.When asked in December, only 22% of Americans believed they would receive more this year than last, and 26% believed they would receive less.

When asked how much they actually received, one-third (32%) said they received more this year than last year, while 28% reportedly received less.The primary reasons people believe they received more this year were: working more (37%), adjustment of deductions or withholdings (31%), and getting a pay raise or promotion (16%).Meanwhile, participants who received a smaller refund amount believe it was likely due to losing work (29%), moving to a higher tax bracket (21%) and having dependents age out of eligibility (11%).Sixty-two percent felt happy and surprised by the amount they received; another m...