Why is my IRS refund amount so different in comparison to last year?
Many factors can affect the refund amount you’re entitled to each year and result in a lower refund than you might have anticipated. When attempting to understand changes to tax refund from a prior year, look at your returns line-by-line to find out what might have contributed to the refund changes. These factors include:
- Deductions or adjustments you claimed last year but weren’t able to claim this year for various reasons
- Changes in your income. (An increase or decrease might affect your eligibility for certain credits as well as your overall tax bracket.)
- Changes in federal income tax withholding. This could be due to a change in your income, your W-4, or the way you earned the income like overtime or bonus money.
- Self-employment income or losses and the associated taxes
- Changes in distributions from your retirement account and the associated taxes and / or penalties
- Changes in dependents you were able to claim could mean less refund
- Changes in your filing status
—– Penalties for not having Minimum Essential Health Coverage or a Repayment of Excess Premium Tax Credit