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What to Do with Your Tax Refund: 5 Smart Moves for Canadians

  Tax Season · Personal Finance By MoneySavings.ca Editorial Team • May 7, 2026 • 7 min read Tax season is wrapping up across Canada, and for millions of Canadians, that means a refund cheque — or a direct deposit — is on its way. The average Canadian tax refund hovers around $1,800. That's real money. The question is: what's the smartest thing you can do with it? It's tempting to treat a tax refund like "found money" and splurge. But here's the truth — that refund was your money all along. The government was just holding it for you, interest-free. So before it quietly disappears into day-to-day spending, let's look at five moves that will make it work harder for you. $1,800 The average Canadian tax refund — enough to make a meaningful dent in debt, pad an emergency fund, or kick-start your TFSA for the year. 1 Pay Down High-Interest Debt First If you're carrying a balance on a credit card, this should be your very first call. Most Canadian credit car...
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IRS to Lay Off 6,700 Employees Amid Tax Season

The U.S. Internal Revenue Service (IRS) is set to lay off approximately 6,700 employees this Thursday, according to a source familiar with the matter. This significant reduction in workforce comes as part of a broader federal government directive aimed at reducing bureaucracy, spearheaded by President Donald Trump and Elon Musk.

The employees affected by the layoffs are primarily probationary workers who have been with the agency for less than one to two years. These workers typically have fewer job protections compared to their longer-term counterparts. The IRS has a total of roughly 17,000 probationary employees.

The timing of these layoffs is particularly challenging, as it coincides with the critical tax-filing season. The IRS remains busy processing returns and refunds for taxpayers well beyond the April 15 filing deadline. Concerns have been raised about the potential strain on the agency's resources and its ability to manage the substantial workload during this period.

Despite the layoffs, around 6,600 probationary IRS employees will be retained to work through the tax-filing season. The IRS has taken a more measured approach compared to other federal agencies, ensuring that essential operations continue during this crucial time.

The broader federal workforce reduction directive has impacted various agencies, with the Office of Personnel Management overseeing the dismissal of probationary employees across the government. The IRS's approach highlights the delicate balance between reducing bureaucracy and maintaining essential services for taxpayers.


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