IRS’ Quick Pace on Tax Refunds Is Fueling Consumer Spending
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U.S. tax refunds are running 16.3% ahead of last year’s pace, according to the Internal Revenue Service.
The IRS reported it sent taxpayers $70.2 billion in refunds by March 19, up from $60.4 billion during the same period last year.
The increase in refunds has helped to boost consumer spending in the first quarter, according to some economists. Because consumer spending accounts for about two-thirds of overall U.S. economic output, the increase in refunds could translate into more growth than expected in the first quarter.
The economic assistance, however, is almost at an end.
Many taxpayers received their money earlier this year because more filed electronically. More taxpayers will now be paying taxes as the April 15 filing deadline draws near.
Some taxpayers are finding their refund checks a little heftier this year because they are able to take advantage of some new and lucrative tax credits.
For example, some taxpayers can now claim a $400 tax credit for each dependent child under the age of 17.
The average refund so far this year is $1,609, up from $1,397 during the same period last year.
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