The two most common factors that reduce refunds from a prior year are withholding or refundable tax credits such as the Child Tax Credit or Earned Income Tax Credit.
Here is a helpful link for previewing your current year form 1040 to compare to last year's return.
A tax refund is a return of an overpayment of taxes usually collected through withholding during the year. Since there was an income increase there may not have been enough of an increase in withholding to cover the tax on that new income.
You should compare your taxable income lines (line 15) and taxes withheld lines (line 25) on your current and prior year returns to see if this is the case. You will see the change on line 15 but not much increase, if any, on line 25.
If that appears to be an issue then you would need to submit a new form W-4 to your employer to increase withholding. The result will be lower paychecks, but a bigger year-end refund.
Here is a link to a W4 calculator to assist with making changes.
The second area to compare is the credit lines (lines 19 and 32) on your prior year and current year returns to see if the credit amounts decreased. This could be due to not qualifying for credits or qualifying for a lower credit amount due to an increase in income for example.
Adjusting withholding on the Form W4 will assist in mitigating this situation as well.
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
