White House Economic Advisor Kevin Hassett Predicts 2026 as Largest Tax Refund in US History

As tax season approaches in the United States, American citizens might actually have something to look forward to. According to Kevin Hassett, the White House Director of the National Economic Council, next year's tax filing will see taxpayers receive the 'biggest refunds of all time.'

His bold prediction was based on a recent major legislative change. Because of the way new laws were passed, the Internal Revenue Service ended up holding on to more of the taxpayers' money than it was supposed to, and the agency needs to give it all back.

The New Law Behind Kevin Hassett's Record-Breaking Refund Prediction

The main reason for this historic payout is a new bill called the 'One Big Beautiful Bill Act' or OBBBA that was formally signed into law on 4 July 2025. While this legislation took effect immediately, providing big tax cuts right away, the timing of its passing, which was in the middle of the year, caused an issue with paperwork.

Since the OBBBA law was activated when the 2025 tax year had already started, the IRS did not have enough time to adjust its national withholding tables. As a result, most workers ended up paying their taxes at higher rates, which were based on the old tax collection table, in the latter half of this year.

Tax Adjustments to Expect in 2026

'There is so much good news in the new year, because you are going to see the biggest tax refund season of all time, Hasset told Fox News's anchor Shannon Bream. 'The 'big, beautiful bill' was passed in July and you know, the IRS did not have time to change all the forms, and so now everybody's going to get huge tax refunds if they were overtime workers, if they are seniors, if they — you know — had tip income.'

Who Will Benefit Most?

One primary reason why the economic advisor is so confident in a historic tax refund in 2026 is the specific nature of the new deductions. The new OBBBA law did not just bring down the general rates, but it also targeted some particular groups of workers who are now eligible for the significant payout, and they are:

• Service and Hospitality Workers: They usually have incomes from tips, and the 'No Tax on Tips' mandate gives them a deduction of up to £18,687 ($25,000) from the total amount they earned.

• Hourly Employees: The 'No Tax on Overtime' law allows a major deduction on additional shifts, and taxpayers can enjoy up to £9,000 ($12,500) of qualified overtime compensation.

• Seniors: Americans aged 65 and up can now take an additional £4,468 ($6,000) off their taxes. This change was made to provide older people who live on a set budget a quick financial boost.

A Potential 'Tariff Dividend' Cheque

Finally, on top of the regular tax refunds, the government wants to inject more cash into the economy. Hassett and other White House officials confirmed they are looking into the proposed £1,490 ($2,000) 'tariff dividend' cheque.

These cheques would be paid for by the extra money the government collected from trade tariffs. The officials explained that this would be a separate payment aimed at helping low-income and middle-income households in the US.