New Year’s resolutions are often about being more responsible with your time, exercising, or working toward a larger goal. The value of keeping such a resolution comes when you can look back and see how far you’ve come in accomplishing what you set out to do.
Last year, Republican lawmakers set their sights on major tax legislation, and now, the results of that work will start to show up—including larger refunds for millions of taxpayers. But that doesn’t mean Congress should stop its tax reform work, especially if lawmakers are serious about addressing affordability and economic anxiety in their 2026 goals.
3 important lessons
As we look ahead to economic policy for this year, there are three important lessons from last year.
First, the real value of the tax legislation is not in your refund. Because policymakers made seven substantive changes to individual income taxes that took effect in 2025, refunds will be larger this year. This includes a $200 increase in the maximum child tax credit, a larger standard deduction, and an increased itemized deduction for state and local taxes. The other four changes are the policies that reduce taxes for some seniors, tipped and overtime workers, and individuals who have auto loans.
