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
What triggers the IRS to audit a tax return? Learn how common tax mistakes and errors can be a red flag and affect your chances of being audited by the IRS.
Find the current percentages for federal income tax rates, capital gains tax rates, Social Security tax rates and more from the tax experts at H&R Block.
The key to understanding your w-2 form is decoding the boxes and numbers. Learn how to read your w-2 form with this box-by-box infographic from H&R Block.
The tax experts at H&R Block outline how students and parents can file Form 8863 and document qualified expenses. Read about Form 8863 here.