Tax reforms spark surge in U.S. business investment and record refunds
Recent tax changes have led to higher IRS refunds and a noticeable uptick in corporate spending on equipment, technology and hiring.
According to a Government Accountability Office release, the IRS processed $296 billion in refunds during the 2026 filing period, up 17% from the previous year, with the average refund rising by $333. The surge reflects new deductions for tips, overtime and the permanent reinstatement of 100% bonus depreciation, which lets businesses deduct the entire cost of qualifying purchases in the year incurred. Expanded Section 179 provisions also permit greater upfront write-offs for small firms, and recent IRS guidance has clarified the rules.
As a result, firms are buying new equipment, modernizing plants, expanding locations and hiring additional workers, viewing the tax environment as supportive of growth. The article argues that these trends contradict narratives of a weakening economy and signal confidence among entrepreneurs and established companies alike.
Why it matters
The tax changes directly affect household incomes and business expansion, shaping economic activity across the United States.
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