Tax season brings a payday for many Americans - here’s how many cash in.

Answer: 

• About ⅔ of Americans receive a refund
• Average amount: $3,138

Questions:

• How might receiving a tax refund impact consumer spending and saving?
• What are the pros and cons of getting a large tax refund (instead of getting a larger paycheck throughout the year)?
• If you received a tax refund of $3,138, how would you use it? Explain why.

Click here for the ready-to-go slides for this Question of the Day that you can use in your classroom.

Behind the numbers (Bankrate):

"It’s nice to see a tax refund show up in your bank account, especially if it’s a sizable one. But a big refund means that over the previous year, you gave the IRS more money than you had to. That means your paychecks were smaller than necessary. And when the IRS sends you a refund, it doesn’t come with interest.

On the other hand, if you owe the IRS at tax time, it means you’re not having enough taxes withheld from your pay throughout the year. While it may be nice to have the extra money every pay period, you’ll have to write a check to the IRS, and if you underpaid by a significant amount, you may owe penalties and interest."

Note: This Question of the Day pulls data directly from the IRS. The numbers in this Bankrate article will differ slightly because they are only updated through October, 2024. 

----------------

Want to dig into the 1040? Check out NGPF's On-Demand module: Tackling the 1040. 

About the Author

Kathryn Dawson

Kathryn (she/her) is excited to join the NGPF team after 9 years of experience in education as a mentor, tutor, and special education teacher. She is a graduate of Cornell University with a degree in policy analysis and management and has a master's degree in education from Brooklyn College. Kathryn is looking forward to bringing her passion for accessibility and educational justice into curriculum design at NGPF. During her free time, Kathryn loves embarking on cooking projects, walking around her Seattle neighborhood with her dog, or lounging in a hammock with a book.