Service Description

While there are particular laws and regulations regarding taxes and how your refund is calculated, there are some ways to get a bigger refund potentially. Advise on the tax preparation process. Use applicable federal, state, and local tax laws to determine deductions and how much you will pay or earn on your return from our in-depth knowledge of applicable tax laws, regulations, and deadlines. Proficiency with standard tax preparation, word processing, and spreadsheet software applications. Familiarity with the tax return submission and confirmation process, including navigating the IRS and other government entity online platforms. 1. Know Available Deductions and Your Exemptions. An exemption is money you earn but doesn’t have to pay taxes. A deduction lowers the amount of your income you have to pay taxes on by reducing your taxable income. There are two main tax deductions—standard deductions and itemized deductions. Taxpayers must use one or the other, and the IRS notes it’s generally best to itemize deductions if your total itemized deductions are greater than the standard deduction. Both exemptions and deductions reduce the amount of money you owe the IRS each year and can help you score a bigger refund or a lower bill. That’s why it’s essential to know which deductions you’re eligible for if you itemize. We cover a few common ones below. To learn more, see our guide to standard tax deductions and exemptions. Do Tax Deductions Increase Your Refund? A tax deduction doesn’t provide a dollar-for-dollar reduction of your income tax liability. A tax deduction lowers your taxable income, which means you’re paying less in taxes overall. It can also increase your refund, but this depends on how significant the deduction is, what kind it is, your income, and your filing status. It’s also essential to ensure you’re only taking deductions you’re eligible for. Tax Credits. A tax credit gives you a dollar-for-dollar reduction in the amount of tax you owe. So, if you receive a $1,000 tax credit, you pay $1,000 less in taxes. https://www.irs.gov/credits-deductions-for-individuals Is There a Limit on Tax Refund Amount? There’s no limit on the amount your tax refund can be. However, high-value tax refunds may sometimes be sent as a paper check instead of a direct deposit. The IRS doesn’t publish the threshold for when a statement is issued instead of a direct deposit, but it does limit direct deposits to three deposits per account.