WASHINGTON (AP) — The Republican-led tax overhaul passed in 2025 is coming into sharper focus this April as nearly 100 million households complete filings under the new system. While Treasury Department data shows 63% of filers received larger refunds compared to 2024, analysts note the benefits skew toward higher earners due to changes in deductions and corporate tax rates.
The law preserved seven income brackets but lowered rates across most categories while eliminating personal exemptions. “Middle-class families see modest relief, but the real winners are pass-through businesses and top earners,” said a Brookings Institution economist who analyzed IRS data.
White House officials counter that the average $1,200 refund increase demonstrates broad benefits. However, Tax Policy Center models suggest 42% of savings went to the top 10% of earners. The law’s $10,000 cap on state and local tax (SALT) deductions continues drawing criticism from lawmakers in high-tax states.
With midterm elections approaching, both parties are framing the tax season results through political lenses. Analysts warn the law’s full economic impact won’t be clear until 2027 when temporary provisions for individuals expire.