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The Average 2020 Tax Refund Was Almost $3,000, Report Finds

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The average tax refund clocked in at $2,827 this year, according to a new report from the independent National Taxpayer Advocate (NTA).

About 70% of individual returns processed so far have been due refunds, per the report, which is prepared annually by the NTA.

Many more taxpayers are still awaiting their refunds. The NTA's report says that the IRS had a backlog of 35 million tax returns to manually process in May 2021, three times larger than 2020's backlog.

The 2021 filing season was a "perfect storm," the report states, with the IRS dealing with the fallout from the Covid-19 pandemic, including a reduced number of employees to process returns and answer phone calls, close to 12 million tax returns left over from the 2020 filing season, and tax law changes stemming from the American Rescue Plan, the increased child tax credit and unemployment benefits.

Then there were the economic stimulus payments, which were critical for many taxpayer households but stretched the agency even more. Finally, many more people filed returns this year, which the advocate credits, in part, to low-income taxpayers who typically do not file but did so this tax season to receive their stimulus checks.

Though there were many challenges, the report says the IRS must improve its processing in the future.

"For individuals and businesses that waited nine months, 12 months, or longer to receive their refunds, the reality of the long delays was incomprehensible and in many cases, financially distressing," the report reads. "Americans deserve better."

The agency also had a historically high number of unanswered phone calls, responding to less than 10% of calls for assistance.

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