on your example, it is correct but I would state it a little differently so the word usage is clear:
tax liability - tax withheld = tax owed or tax overpaid
Example: If your tax liability was $375 in taxes, but you received a nonrefundable credit of $500, the tax liability was reduced to zero, and the remaining $125 was lost. You would not receive a refund for the remaining $125.
Another example. Let's say the tax liability is $375 and the withholdings were $500.
Example: If your tax liability was $375 in taxes, but you received a nonrefundable credit of $500, the tax liability was reduced to zero, and the remaining $125 was lost. You would not receive a refund for the remaining $125; however you would refund of the $500 withholdings because the tax liability is $-0- and the withholdings is $500, so based on the formula you posted, that is a $500 refund
which makes the "help section" accurate.
