Tax refunds are usually the biggest amount of money individuals get from the government each year, short of a lawsuit settlement or a lottery award.<\/p>\n\n\n\n
Many people look forward to this time of year because they already have a plan to spend the money. Others manage their money quite well through the year and are simply waiting for their bonus to come back. Either way, tax refunds can make a big difference for those individuals who receive them.<\/p>\n\n\n\n
So how are tax refunds<\/a> calculated? How can you plan ahead to make them more helpful?<\/p>\n\n\n\n Your refund is based on how much you\u2019ve paid in during the year for taxes. Depending on how much came out of your paycheck each week, you might not have paid enough to cover your annual tax bill.<\/p>\n\n\n\n The annual tax bill you\u2019re supposed to pay is based on your income amount. Some people try to manipulate this by adjusting the number of dependents they claim through the year and then correcting that when it\u2019s time to file taxes.<\/p>\n\n\n\n They can do this to ensure that they get a refund<\/a> by overpaying during the year. They can also do this to get the most out of their check during the year and avoid giving the government an interest-free loan.<\/p>\n\n\n\n Of course, this could cause them to owe at the end of the year, but that is the risk they\u2019re willing to take.<\/p>\n\n\n\n You\u2019re going to get a refund if you pay more in during the year than your tax bill says you owe. If you don\u2019t pay enough, you\u2019re going to get a bill when you file your taxes.<\/p>\n\n\n\n At certain levels of income, there are tax breaks that individuals qualify for. This could have to do with the number of children they have or whether or not they own a business.<\/p>\n\n\n\n For example, if your income falls below a certain number and you have the right number of qualifying dependents, you\u2019ll receive a tax credit<\/a> for each child. The law has changed on this several times, but it\u2019s usually around $1,000 for each child. This year, it just happens to be $2,000 per child.<\/p>\n\n\nBasic Tax Refunds and Disbursements<\/h2>\n\n\n\n
Tax Deductions and Dependents<\/h2>\n\n\n\n