Bessent Says Trump Tax Cuts Will Lead To Gigantic Refund Checks
Treasury Secretary Scott Bessent is signaling that working Americans may be in for a major financial boost next tax season, thanks to the sweeping tax relief included in President Donald Trump’s One Big Beautiful Bill Act.
Speaking on the All In Podcast, Bessent — who is also serving as acting commissioner of the Internal Revenue Service — said taxpayers could see unusually large refunds when they file their 2025 returns in 2026. According to Bessent, the law’s tax cuts apply retroactively to the start of the year, but most workers never adjusted their withholding after President Trump signed the legislation into law in July.
That mismatch, he explained, could translate into sizable checks from the IRS.
“I can see that we’re gonna have a gigantic refund year in the first quarter because working Americans did not change their withholdings,” Bessent said. “I think households could see, depending on the number of workers, $1,000 to $2,000 refunds.”
Bessent’s outlook was echoed by an analysis from the Tax Foundation, a nonpartisan tax policy organization, which said refunds are expected to be larger than normal because of the One Big Beautiful Bill Act’s tax reductions.
“Refunds will be larger than typical in the upcoming filing season because of the One Big Beautiful Bill Act’s tax cuts for 2025,” the foundation wrote in a Dec. 17 report.
According to the Tax Foundation, the law cut individual taxes by an estimated $144 billion for 2025 alone. Outside estimates cited by the group suggest that as much as $100 billion of those savings could ultimately be returned to taxpayers in the form of higher refunds.
While not every filer will see a dramatic increase, the organization said average refunds could rise by as much as $1,000. One key reason, the report noted, is that the IRS did not update its withholding tables after the law passed, meaning workers continued to have more taxes taken out of their paychecks than required under the new rules.
“As a result, instead of gradually receiving the benefit of the tax cuts through higher take home pay during the year, most taxpayers will receive it all at once when they file their returns,” the foundation said.
The Tax Foundation identified seven major tax cuts in the OBBBA that could drive the higher refunds. Among them are expansions of the child tax credit and the standard deduction, along with an increase to the state and local tax deduction cap. The law also added or expanded deductions for seniors, auto loan interest, tip income, and overtime pay — provisions squarely aimed at middle- and working-class Americans.
The refund discussion comes as questions continue to swirl around President Trump’s proposal for a broader “tariff dividend.” Earlier this month, Trump announced during a nationwide address that members of the U.S. military would receive what he called a “Warrior Dividend,” prompting renewed interest in whether the general public could also receive a $2,000 payment.
Trump first floated the idea of a tariff-funded dividend in a Truth Social post in November, saying it would go to “everyone” except high-income earners. Days later, on Nov. 12, Bessent clarified that the payments would be limited to families earning $100,000 or less. Since then, the president has repeatedly emphasized that the plan remains alive, suggesting payments would likely go out “probably in the middle of next year.”
“We’re going to be issuing dividends later on, some somewhere prior to, probably in the middle of next year, a little bit later than that. Thousands of dollars for individuals of moderate income, middle income,” Trump said on Nov. 17, as reported by Axios.
Still, any such payment would require congressional approval. “Any form of stimulus payment issued by the U.S. government would have to be approved by Congress,” the El Paso Times reported.
With Washington continuing to struggle under the weight of a massive federal deficit, it remains unclear whether even a GOP-controlled Congress will ultimately greenlight the proposed payments — though the prospect of larger tax refunds is already locked in under President Trump’s signature tax law.