- Mark as New
- Bookmark
- Subscribe
- Subscribe to RSS Feed
- Permalink
- Report Inappropriate Content
Deductions & credits
If you think you can just remove the advance in the program to increase your refund you will be disappointed when the IRS catches your error (months from now) and reduces the refund like the program is already doing.
And let me see if I can shed some light on this situation that many folks will find themselves in this year when they are disappointed in the bottom line. Here is an example for just one child ...
Last year the credit was $2000 of which only $1400 could be refunded after taxes were paid down.
This year the credit is $3000 (or $3600) of which you got 1/2 up front leaving just $1500 (or $1800) for the credit on the return to pay down your tax bill.
So last year the credit on the return was $2000 and this year it is only $1500(or $1800) ... you are short $500 (or $200) on the return. You are thinking the credit went up so my refund should be more but remember you got some in advance. Review the 2020 & 2021 returns side by side to see this in action.
You need to look at the entries from line 24 to 31 on your tax return form 1040. Then compare them to the same lines on last year's tax return. On these lines you will see your Total Tax (line 24) and the deductions from that tax (lines 25 to 32.) That is where you will find the difference between this year and last year, and that may explain why you owe taxes this year or have a lessor refund than expected.