If you’ve filed your 2025 return and done a double-take at the final number, you aren’t alone. Early data from the 2026 tax season shows average refunds are trending significantly higher—up nearly 14% compared to last year. The reason isn’t just inflation; it’s the full implementation of the Omnibus Budget & Benefit Bill (OBBB), widely referred to as the “One Big Beautiful Bill” provisions.
Here is the Bottom Line Up Front:
For the 2026 filing season (2025 tax year), the Standard Deduction has jumped to $31,500 for married couples and $15,750 for singles. Additionally, if you work for tips or overtime, new “below-the-line” deductions could be reducing your taxable income by thousands, directly boosting your refund.
The “Standard” Bump
The biggest driver of these fatter checks is the aggressive adjustment to the Standard Deduction. The OBBB codified a massive inflation adjustment intended to shield middle-class income.
2025 Standard Deduction (Filed in 2026):
- Single: $15,750 (Up $1,150 from 2024)
- Married Jointly: $31,500 (Up $2,300 from 2024)
- Head of Household: $23,625 (Up $1,725 from 2024)
This means the first $31,500 a married couple earned in 2025 is now effectively tax-free federal income.
The “No Tax” Tiers: Tips & Overtime
The most viral part of the OBBB is the targeted relief for service and hourly workers. If you see a massive difference in your refund this year, check if your tax software applied these new deductions correctly:
- Tip Income Deduction: You can now deduct up to $25,000 in reported tip income.
- Overtime Deduction: Qualifying overtime pay (time-and-a-half) is now deductible up to $12,500 for singles.
Critical Note: These are deductions, not credits. They lower the amount of income you are taxed on, which lowers your tax bill and increases your refund if you overpaid via withholding.
The “SALT” Cap Relief
For homeowners in high-tax states (like NY, NJ, CA), the OBBB temporarily raised the State and Local Tax (SALT) deduction cap.
- Old Cap: $10,000
- New 2025 Cap: $40,000 (for joint filers with income under $500k).
This alone is releasing thousands of dollars back to middle-class homeowners who previously lost those deductions.
Refund Comparison: 2025 vs. 2026
Based on a married couple earning $85,000 w/ 2 kids.
| Feature | 2024 Tax Year | 2025 Tax Year (Current) |
| Standard Deduction | $29,200 | $31,500 |
| Child Tax Credit | $2,000/child | $2,200/child |
| Average Refund | ~$2,900 | ~$3,450 |
If your refund looks “too good to be true,” verify your entries. But for millions of Americans, the 2026 season is legitimately paying out more. You can verify these new brackets directly at the IRS.gov Credits & Deductions page.
Disclaimer: This article is for informational purposes only and does not constitute financial or legal advice. Always consult official government resources.
Evan Cole Editor-in-Chief | Breaking News & Public Policy
“From Washington to Wall Street, and Main Street to Hollywood—Evan Cole connects the dots.”
As the Editor-in-Chief at Newskilo, Evan leads a dynamic team of journalists dedicated to uncovering the truth behind the headlines. With over 15 years in digital media, Evan has a reputation for cutting through the noise.
While he is widely recognized for his deep analysis of U.S. fiscal policy (IRS & Stimulus), Evan’s expertise extends to global current events, corporate accountability, and cultural trends. Whether he is breaking down a complex government bill, exposing a tech giant’s failure, or analyzing the societal impact of a viral celebrity moment, Evan’s goal is simple: To tell the stories that shape our world with clarity, accuracy, and integrity.