📺 Stream EntrepreneurTV for Free 📺

Your Tax Refund Could Be Smaller Next Year, IRS Warns — Here's Why And the money you do get back might not be timely either.

By Amanda Breen Edited by Jessica Thomas

entrepreneur daily
Emir Memedovski | Getty Images

Many Americans rely on tax refunds to pay bills and save for retirement, but next year's checks could be significantly smaller than in previous years.

In a November press release, the IRS revealed that taxpayers may see less money back in 2023, as there were no stimulus checks in 2022, and those who do not itemize and instead take the standard deduction will be unable to deduct their charitable contributions.

Related: When It Comes to Taxes, Here Is How to Handle Inventory

Generally, taxpayers receive a federal refund when they've overpaid yearly taxes or withheld more than the amount owed. The average refund for the 2022 filing season was $3,176 as of October 28, per the IRS — an almost 14% increase from $2,791 in 2021.

Congress offered tax incentives for charitable cash gifts during the Covid-19 pandemic, and the tax break was extended for 2021, CNBC reported. But that exception no longer applied in 2022.

"Deductions for charitable donations in 2022 are not as robust as 2021," certified financial planner Marguerita Cheng, CEO of Blue Ocean Global Wealth in Gaithersburg, Maryland, told the outlet.

Related: How a Business Owner Won Back $102,000 From the IRS

Additionally, the IRS has cautioned taxpayers not to expect their refunds "by a certain date," as some filings will be subject to "additional review." As of November 18, 3.4 million returns received in 2022 remained unprocessed, the IRS reported.
Amanda Breen

Entrepreneur Staff

Senior Features Writer

Amanda Breen is a senior features writer at Entrepreneur.com. She is a graduate of Barnard College and received an MFA in writing at Columbia University, where she was a news fellow for the School of the Arts.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Side Hustle

These Coworkers-Turned-Friends Started a Side Hustle on Amazon — Now It's a 'Full Hustle' Earning Over $20 Million a Year: 'Jump in With Both Feet'

Achal Patel and Russell Gong met at a large consulting firm and "bonded over a shared vision to create a mission-led company."

Side Hustle

How to Turn Your Hobby Into a Successful Business

A hobby, interest or charity project can turn into a money-making business if you know the right steps to take.

Business News

These Are the 10 Most Profitable Cities for Airbnb Hosts, According to a New Report

Here's where Airbnb property owners and hosts are making the most money.


Want to Be More Productive? Here's How Google Executives Structure Their Schedules

These five tactics from inside Google will help you focus and protect your time.

Business News

How Much Do Engineers, Software Developers, and Analysts Make at Apple? See Salary List

Using application data from highly-skilled foreign workers, Insider revealed a range of salaries at the tech giant.