Tax refunds up from 2023; most Americans plan to pay down debt or save

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American taxpayers will on average see larger tax refunds compared to a year ago, and most plan to use that money to either pay down debt or save, though more plan to invest it or go shopping compared to a year ago, according to a new report from the Bank of America Institute.

Internal data from Bank of America showed that for average tax refunds received via direct deposit through March 31, 2024, taxpayers earning less than $50,000 a year saw their refunds grow by nearly 9% from a year ago. That outpaced the almost 6% growth in refunds for taxpayers in the $50,000 to $125,000 range, as well as the roughly 4% larger refunds received by those above the $125,000 threshold.

«It looks like the average refund is going to be about 5% larger this year than last,» David Tinsley, senior economist at the Bank of America Institute, told FOX Business. «That means in terms of dollars you're looking at a refund of around $3,000 or so.»

Data from a survey conducted by CivicScience for the Institute's report asked tax fund recipients about their plans for spending their tax refund, with most saying they plan to use it to pay down debt or save it.

YOUR TAX REFUND COULD BE BIGGER THIS YEAR – HERE'S WHY

Americans' tax refunds are expected to be about 5% larger this year, with low income taxpayers seeing a bigger increase. (iStock / iStock)

CivicScience found that about 25% said they will pay down their debt, a decrease from just under 30% a year ago. Roughly 23% said they will save their tax refund this year after a little more than 25% said they would save their 2023 tax refund. 

About 13% of tax refund recipients surveyed