Who Is Most Likely to Receive a Bigger Tax Refund in 2026?

Several groups stand out as potential winners under the new tax law. If you fall into one or more of the categories below, your IRS tax refund could be higher than usual.

Homeowners in High-Tax States

Homeowners in states with high property taxes and state income taxes may see some of the largest gains.

The new law temporarily raises the State and Local Tax (SALT) deduction cap from $10,000 to $40,000 per year for households earning $500,000 or less.

This change alone can significantly reduce taxable income for homeowners in states like California, New York, New Jersey, and Illinois—leading to lower tax liability and potentially larger refunds.

For homeowners already facing high mortgage interest, home insurance premiums, and cost-of-living expenses, this deduction could provide meaningful relief.