Capital losses are taken against capital gains, such as the sale of stocks or property that has increased in value. If you have investments that have increased in value, you can sell them to realize the gain, then re-buy them or similar investments so that you can set a new higher basis that will reduce your gains in the future. (But, if you sell and then re-buy the same or similar investments, you must wait at least 31 days!)
Your refund is irrelevant. Even your tax liability is irrelevant. If you had $10,000 of withholding and you get a $1000 refund, your tax liability to the IRS was $9000. If you had $5000 of withholding and owed another $4000, your liability is still $9000. And that has nothing to do with the gains and losses carryover.
