Why did our refund decrease after I added the stimulus checks?

[AlanT222]

Stimulus payments were advances on the Recovery Rebate Credit.

If you received the full amount of both stimulus payments (Economic Impact Payments), you won’t get any additional credit on your return this year since you’ve already received the full amount of the credit as stimulus payments.

TurboTax automatically calculates the Recovery Rebate Credit for you.  Once you enter in the stimulus payments you received, the Recovery Rebate Credit is reduced, not your refund.  

[DawnC]

Was it your state refund?   Are you in Oregon by any chance?   The state of Oregon does not tax the stimulus payments or rebate credits directly.  Oregon reduces your taxable income by your federal tax liability.   But they make adjustments to that reduction.  Your stimulus payment(s) and the recovery rebate (if you did not receive your full payments) are subtractions to your federal tax liability number on your Oregon state return Line 10 of Form 40).  So, the reduction to taxable income is less which equates to a higher taxable Oregon income.