For some, new withholding tables that were in place for 12 months in 2019, but only 10 months in 2018, may have been the reason why their tax refund was less than expected for 2020. While each taxpayer’s situation is different, it’s important to remember the role that withholding can have on what you get back.
If you paid too much in taxes during the year through payroll withholdings, then you may get a refund. If you paid too little in withholding then you may owe additional tax. If you live in a state that assesses income tax, then you'll need to file a state return along with your federal return.May 21, 2021
In a nutshell, over-withholding means you'll get a refund at tax time. Under-withholding means you'll owe. Many people try to get as close as possible to even so they get more money in their paychecks during the year, but don't owe a lot or get a bigger refund at tax time.Aug 6, 2021
What's the Average Tax Refund?
|Average Tax Refund by State|
|State||Number of Individual Refunds Issued||Amount of Internal Revenue Refunds Issued (thousands of dollars) for Individual Returns|
Credits may earn you a tax refund The IRS offers a number of tax credits that you can take directly off your taxes rather than your income. If you qualify for tax credits, such as the Earned Income Tax Credit or Additional Child Tax Credit, you can receive a refund even if your tax is $0.Aug 13, 2021
Con: You Keep Less of Your Monthly Paycheck Sometimes deductions and smart itemization lead to a fat tax return. Other times it's because people pay more taxes than necessary every month. Some taxpayers do this purposely by arranging to have a surplus amount taken out just in case their taxes are higher than expected.Jan 10, 2019
One thing all filers should keep in mind this year is that owing the IRS money is really only a bad thing if you can't pay your tax bill. If you don't have the cash on hand to pay what you owe by the April 15 filing deadline, you'll incur interest and penalties on your unpaid taxes, which clearly isn't good.Feb 16, 2020
Tax returns are opened and processed in the order received. When it comes to why your refund may be delayed, the IRS states it may be delayed because it has a mistake including errors concerning the Recovery Rebate Credit, is missing information, or there is suspected identity theft or fraud.Jun 25, 2021
For some, new withholding tables that were in place for 12 months in 2019, but only 10 months in 2018, may have been the reason why their tax refund was less than expected for 2020. While each taxpayer's situation is different, it's important to remember the role that withholding can have on what you get back.
Since the 2021 credit is fully refundable, you'll get a tax refund if the credit amount you claim on your return is greater than your tax liability. If the credit amount available is less than your tax liability, you'll still see a reduction of the tax you owe.Jul 31, 2021