Why is My Tax Return So Low 2024? Check the causes behind it! - GMRIT (2024)

Many people are excitedly awaiting their tax refunds in 2024 as tax season gets underway, hoping for an increase in income. But when they learn that their projected return is less than expected, some people might feel confused and let down. The explanations for the low tax refund in 2024 are listed below.

Why is My Tax Return So Low 2024

Many Americans anticipate receiving a smaller return than they did the year before, which is causing them some financial concern as tax season approaches.

Twenty-five percent of taxpayers believe they will receive a lesser refund in 2024 (for their 2023 tax return) than they did in 2023 (for their 2022 tax return), according to a December study of 2,500 individuals conducted by tax prep software business TaxAct. Over 33% of people expect their tax refund to be roughly the same.

Why is my refund so low this year?” is a common issue that arises as tax season arrives. If your 2024 return looks a little low, you’re not alone. A smaller than expected return can be caused by a number of things, including changes in income, policy changes, and filing problems.

You’re not the only one wondering about this; hundreds of Americans are also considering it. Let’s examine some official IRS data and some explanations for why your return might not be as excellent as you had hoped.

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What causes My IRS Tax Return to Be So Low in 2024?

A taxpayer’s refund might be reduced this year for additional reasons, such as a change in the number of dependents claimed, a change in filing status, a change in work, a rise in self-employment income, or other events that happened in 2024 but did not in previous years.

Here is a thorough explanation of the subject “Why is My Tax Return So Low 2024.”

  • In 2024, one of the main causes of reduced tax returns will be the constantly changing tax law environment.
  • The amount of money deducted from a person’s salary at the end of the year is a major factor in figuring out their ultimate tax burden or refund.
  • Verify your return again to be sure that all of the credits, deductions, and income reporting were done correctly. Your refund amount may be greatly impacted by even little mistakes.
  • Due to inadequate information, missing papers might cause processing time for your return and possibly lower your refund.
  • Tax credits and deductions play a key role in reducing taxable income and, in turn, the total amount of taxes owed.
  • Income fluctuations have a major impact on tax returns. An individual may find themselves in a higher tax bracket and hence have a larger tax bill if their earnings grow throughout the tax year.
  • The standard deduction was raised by the Tax Cuts and Jobs Act of 2017, which reduced the value of itemised deductions for taxpayers. Lower reimbursem*nts might be the consequence of insufficient qualifying costs.
  • Refund amounts may also be impacted by limited tax credits such as the Dependent Care Credit, Child Tax Credit, and Earned Income Tax Credit.
  • Unexpected tax consequences might arise from life events like property sales, windfalls, or changes in marital status. These occurrences might result in higher taxable income or change a person’s eligibility for specific tax advantages.

How to Increase your Tax Refund 2024?

It takes a little study, some preparation, and basic tax planning to lay the foundation for a tax refund. You may maximise your tax refund by checking your tax status, talking to your spouse while completing W-4s, and utilising several tax credits.

Filing Status

Taxpayers may choose to file in one of several ways in various situations, and their choice will affect their return. For instance, Reams notes that filing as the head of household rather than as a single offers a higher standard deduction and reduced tax rates.

W-4 Withholding Calculator

When preparing your taxes, you may use a W-4 Withholding Calculator to estimate what you should include on your W-4 and modify the amount you anticipate receiving back. If you are qualified, claiming the Earned Income Tax Credit can lower your tax liability and possibly even result in a tax refund.

Wherever Possible List Deductions

Since the Tax Cuts and Jobs Act of 2017 raised the standard deduction, most taxpayers are no longer required to itemise. But, itemised deductions can result in financial savings for people who have made significant charitable contributions or have substantial medical costs. Donor-advised funds allow donations to be rolled over from previous years into a single year.

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Why is My Tax Return So Low 2024? Check the causes behind it! - GMRIT (2024)

FAQs

Why is My Tax Return So Low 2024? Check the causes behind it! - GMRIT? ›

A taxpayer's refund might be reduced this year for additional reasons, such as a change in the number of dependents claimed, a change in filing status, a change in work, a rise in self-employment income, or other events that happened in 2024 but did not in previous years.

Why am I getting so little back in taxes in 2024? ›

You may be in line for a smaller tax refund this year if your income rose in 2023. Earning a lot of interest in a bank account could also lead to a smaller refund. A smaller refund isn't necessarily terrible, since it means you got paid sooner rather than loaning the IRS money for no good reason.

Why am I getting so little back in taxes? ›

Changes to your income last year may play a role in receiving a smaller refund this tax season. Here are some examples: Salary increase: If you got a salary increase last year but neglected to increase your tax withholding, this could lead to a smaller tax refund when you file.

What is the average tax return for a single person making $60,000? ›

If you make $60,000 a year living in the region of California, USA, you will be taxed $13,653. That means that your net pay will be $46,347 per year, or $3,862 per month.

What is the standard deduction for 2024? ›

Standard deduction 2024 (taxes filed 2025)

In 2024, the standard deduction is $14,600 for single filers and those married filing separately, $29,200 for those married filing jointly, and $21,900 for heads of household. The 2024 standard deduction applies to tax returns filed in 2025. $29,200.

What is the average tax return for 2024? ›

So far in 2024, the average federal income tax refund is $2,850, an increase of 3.5% from 2023. It's not entirely unexpected: To adjust for inflation, the IRS raised both the standard deduction and tax brackets by about 7%.

What is the average tax return for a single person making $40,000? ›

If you make $40,000 a year living in the region of California, USA, you will be taxed $7,507. That means that your net pay will be $32,493 per year, or $2,708 per month.

Why am I getting a low amount on my tax return? ›

If you owe money to a federal or state agency, the federal government may use part or all of your federal tax refund to repay the debt. This is called a tax refund offset. If your tax refund is lower than you calculated, it may be due to a tax refund offset for an unpaid debt such as child support.

Why is my tax return so low when I claim 0? ›

Claiming 0 allowances means that too much money will be withheld by the IRS. The allowances you can claim vary from situation to situation. If you are married with a kid, you can claim up to three allowances.

How to get a bigger tax refund? ›

Here are four simple ways to get a bigger tax refund according to the experts we spoke to.
  1. Contribute more to your retirement and health savings accounts.
  2. Choose the right deduction and filing strategy.
  3. Donate to charity.
  4. Be organized and thorough.
Mar 4, 2024

How to get $7000 tax refund? ›

Requirements to receive up to $7,000 for the Earned Income Tax Credit refund (EITC)
  1. Have worked and earned income under $63,398.
  2. Have investment income below $11,000 in the tax year 2023.
  3. Have a valid Social Security number by the due date of your 2023 return (including extensions)
Apr 12, 2024

Is it possible to get a $10,000 tax refund? ›

You could end up with a $10,000 tax refund if you've paid significantly more tax payments than you owe at the end of the year.

How much do single moms get back in taxes in 2024? ›

Child Tax Credit:

The Child Tax Credit is a valuable tax benefit for single parents. For the tax year 2024, this credit is up to $3,000 per qualifying child between the ages of 6 and 17, and up to $3,600 for children under 6.

Will income tax rates increase in 2024? ›

The IRS has announced its 2024 inflation adjustments. And while U.S. income tax rates will remain the same during the next two tax years, the tax brackets—the buckets of income that are taxed at progressively higher rates—will change.

How long are refunds taking in 2024? ›

What is the IRS refund schedule?
Filing method and refund delivery methodHow long it takes to receive your refund from the time your return is accepted
E-file and direct deposit1-3 weeks
E-file and check1 month
Mail in return and direct deposit3 weeks
Mail in return and check2 months
Feb 21, 2024

Are we getting child tax credit payments in 2024? ›

The child tax credit is a $2,000 benefit available to those with dependent children under 17. For the 2024 filing season, $1,600 of the credit was potentially refundable.

Why are tax refunds so slow this year? ›

Your refund may also be delayed if numbers on your return don't match documents the IRS received about your income. Common mistakes can also cause delays, such as math errors or typos on your Social Security number, or if the direct deposit account doesn't match the filing status on your return.

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