Turbo tax said I would receive $2,364 for my Federal refund. I only received an electronic deposit of $783. Why is there a discrepancy?

[ColeenD3]

If your IRS-issued tax refund comes in around $35 or $40 less than the amount shown in TurboTax, it's probably because you used the Refund Processing Service option to deduct your Turbo Tax fees from your federal tax refund. There's a separate processing fee for this service, which is deducted from your federal refund in addition to your TurboTax fees.

Other missing dollar amounts may be caused by a refund offset. This is when the government applies part or all of a taxpayer's refund towards the taxpayer's past-due income tax, child or spousal support, student loans, or state unemployment compensation debts.

If this happens, you should get a letter from the government explaining why you didn't get the entire refund. You can also get this information by looking up your refund at the IRS Where's My Refund page. 

Finally, the government may have made a correction to your tax return, resulting in a lower (or higher!) than anticipated refund. Again, you'll get an official explanatory letter when this happens.

[PNW999]

Thank you for the explanation. The only thing that I can think of is that somehow that discrepancy was used to pay for my owed State Tax for 2020 somehow.  I didn't think TurboTax would auto pay that owed tax to the state from Federal funds.  Does TurboTax do that? I don't recall seeing that option.

[LenaH]

No. Your federal tax refund would not be offset with an amount owed to the state for 2020.

It could be possible that your refund was adjusted due to the Recovery Rebate Credit. Do you have an amount on Line 30 of your 1040? If so, did you receive your first and second stimulus? Generally, if you have a credit on Line 30 and you received both stimulus payments, then you would not have qualified for the credit. Before the federal review screen, you had to enter both of your stimulus payments received. If that was not entered, then the credit would have been populated on your tax return. 

Per the IRS, if a credit amount was on Line 30 and you did not qualify for the credit, the IRS will calculate the correct amount of the Recovery Rebate Credit, make the correction to your tax return and continue processing your return.

The IRS will send you a notice explaining any change made shortly. 

2020 Recovery Rebate Credit — Topic G: Correcting issues after the 2020 tax return is filed

@PNW999