Taxpayers in Wyoming Receive Largest Average Refunds for a Third Year in a Row as Average Refund Rises 3% to $3,745 Nationwide

LendingTree's study ranks the states where taxpayers receive the biggest and smallest refunds, and where taxpayers owe Uncle Sam the most

CHARLOTTE, N.C., March 9, 2023 /PRNewswire/ -- LendingTree^®, the nation's leading online financial services marketplace, released its study finding the states where taxpayers can expect to receive the biggest and smallest tax refunds based on data from tax year 2020 (the latest available full-year data). As Americans anxiously await tax refunds, the study found that taxpayers in Wyoming received an average of $4,877 in tax refunds, the biggest average of any state for the third year in a row. On the other hand, taxpayers in Maine received an average of $2,920 in tax refunds, the smallest amount nationwide. When it comes to owing Uncle Sam, taxpayers in South Dakota had the largest tax bills at $8,724.

Key findings

• A slightly higher percentage of taxpayers (76%) received a refund in tax year 2020 compared to 75% in the previous tax year. The average refund in tax year 2020 also increased year-over-year, up 3% from tax year 2019.
• Although tax refunds vary widely throughout the country, taxpayers in Wyoming came out on top with the biggest average refund of $4,877, while taxpayers in Maine saw the smallest refunds at $2,920.
• Of taxpayers who owe money, those in South Dakota had the largest tax bill, with an average amount owed of $8,724. Taxpayers in Arkansas with tax bills owed the smallest amount at $5,312.
• Taxpayers who make $10,000 to $24,999 a year receive 11.2% to 28% of their income back, on average, as a tax refund — the highest among the income brackets. While this percentage generally shrinks the more you make, this pattern doesn't continue through the highest brackets.

LendingTree's chief credit analyst, Matt Schulz, added, "With rampant inflation and rising interest rates wreaking havoc on Americans' budgets, a tax refund is a real opportunity for families to build a little bit of a financial cushion for themselves. If the refunds are used to pay down debt, build up savings, or both, they can make a real difference.

Just remember that while it can feel great to get a refund, too big a refund can actually be a bad thing. It basically means that you've given Uncle Sam a big interest-free loan instead of having that money work for you and your family throughout the year. If your refund is too big, adjust your withholdings so you can keep more of your hard-earned money from each paycheck."

To view the full report, visit
https://www.lendingtree.com/debt-consolidation/average-tax-refunds-study/ 

Methodology
LendingTree researchers analyzed federal individual income tax returns (Form 1040s) filed from Jan. 1 to Dec. 31, 2021, for tax year 2020 — the latest available — from the IRS' Statistics of Income program.

Due to processing delays from the COVID-19 pandemic, this data includes paper returns filed through early June 2022 for tax year 2020. The IRS also notes that a limited number of returns are included for tax years before 2020. The IRS defines this as a "proxy for returns that are typically filed beyond the 12-month period."

To estimate the average refund in the U.S. and each state, researchers divided the total amount refunded by the number of people who received refunds. To determine who owed money, researchers divided the total amount owed by the number of people who owed taxes.

About LendingTree, Inc.
LendingTree is one of the nation's largest, most experienced online financial platforms, created to give consumers the power to win financially. LendingTree provides customers with access to the best offers on loans, credit cards, insurance and more through its network of over 600 financial partners. Since its founding, LendingTree has helped over 120 million customers obtain financing, save money, and improve their financial and credit health in their personal journeys. With a portfolio of innovative products, tools and personalized financial recommendations, LendingTree helps customers achieve everyday financial wins. LendingTree, Inc. is headquartered in Charlotte, NC. For more information, please visit www.lendingtree.com.

MEDIA CONTACT:
Nelson Garcia
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SOURCE LendingTree.com