SAN FRANCISCO — Tax refunds may be down so far this year, but those who are receiving them are spending that extra cash on home furnishings.
An analysis of IRS filing statistics between Jan. 29 and March 1 by Earnest Analytics shows the average refund is down 2.4% to $3,009 from $3,083 last year. Consumers are also filing later this year, with the number of refunds given through March 1 down 11.6% from 2023.
Despite those lower numbers, the home furnishings category is the beneficiary of consumers’ refunds, with refund recipients outspending their peers on a year-over-year basis in the four weeks through March 2 by 16%, the highest among the 16 categories tracked. This is double the number it was in the trailing four weeks leading up to tax season, when home furnishings spending was up 8%.
Home improvement, which was down 1% in the pre-tax period, saw its sales jump to a 7% gain as consumers started receiving their refunds. Online marketplaces also saw a strong lift, going from flat to a 7% gain in tax season.
Specific retailers tracked by Earnest Analytics seeing a similar boost include Wayfair, which jumped to a 12% increase for the four weeks trailing March 2 vs. -1% in the four-week period ended Jan. 20; Macy’s (from -4% to 11%); Home Depot (-1% to 8%); Lowe’s (-2% to 7%); Amazon (even to up 7%); and TJX Cos. (3% to 5%).