The main ways to increase your refund are claiming deductions you missed, correcting income or withholding errors, and taking tax credits you didn't know about

A bigger refund comes from either paying less tax during the year or claiming more of what you already paid back. The first route means changing your withholding at your job so less money goes to the IRS each paycheck—you'll have more in your pocket now and a smaller refund later, which is usually better. The second route means finding deductions and credits the IRS will actually honor when you file.

Most people who get large refunds are leaving money on the table by not claiming credits they may have access to for, or they're withholding too much because they haven't updated their W-4 form since their life changed. A few are making mistakes on their return that accidentally inflate the refund. This guide walks through what actually works and what doesn't.

Key Takeaways

  • Tax credits reduce your tax bill dollar-for-dollar and are worth far more than deductions—the Child Tax Credit, Earned Income Tax Credit, and education credits are the biggest ones most people miss.
  • Changing your W-4 form at work to claim more allowances will reduce your withholding and give you more money each paycheck, though your refund will shrink.
  • Deductions lower your taxable income but don't reduce your tax as much as credits do—the standard deduction covers most people, but itemizing can help if you own a home or had large medical bills.
  • If you're self-employed or have side income, you may owe self-employment tax that you're not accounting for, which can wipe out a refund or turn it into a bill.
  • Errors on your return—claiming dependents twice, misreporting income, or using the wrong filing status—can create a false refund that the IRS will catch and reverse.

Tax credits that create the biggest refunds

A tax credit subtracts directly from what you owe. If you owe $800 in tax and you have a $1,200 credit, you owe nothing and get $400 back. Deductions only reduce your taxable income, so they're worth less. The IRS publishes a list of credits each year, but the ones that move the needle for most people are the Child Tax Credit, the Earned Income Tax Credit (EITC), and education credits.

The Child Tax Credit is $2,000 per child under 17 as of 2024, though this amount changes by year. You claim it on Schedule 8812 if you file Form 1040. The Earned Income Tax Credit is for people with lower to moderate income and no dependents, or with children—it can be worth $600 to $3,700 depending on your situation. The IRS has a tool on its website to see if you may have access to. Education credits (American Opportunity Credit, Lifetime Learning Credit) can be worth up to $2,500 per student per year if you paid tuition or student loan interest.

Many people don't claim these because they don't know they exist, or they think they don't may have access to. The IRS does not tell you which credits you're missing—you have to find them yourself or work with a tax preparer. If you have children, received education expenses, or earned less than $60,000, spend 10 minutes on the IRS website checking whether you may have access to for EITC or education credits.

Deductions that increase your refund

A deduction reduces your taxable income. Most people use the standard deduction, which is a flat amount the IRS lets you subtract—$14,600 for single filers and $29,200 for married filing jointly as of 2024. If your deductions add up to more than the standard deduction, you can itemize instead, which means listing them out on Schedule A.

Common itemized deductions include mortgage interest, state and local taxes (capped at $10,000), charitable donations, and medical expenses over 7.5% of your income. If you own a home with a mortgage, you almost always itemize. If you rent and have no major expenses, the standard deduction is your best bet. The difference between itemizing and taking the standard deduction can be $5,000 to $15,000 in deductions, which translates to $1,000 to $3,000 in tax savings depending on your tax bracket.

To know whether to itemize, add up your mortgage interest, property taxes, state income tax, charitable donations, and any other deductible expenses. If the total is higher than the standard deduction for your filing status, itemize. If not, take the standard deduction and move on.

Adjusting your withholding to get more money now instead of later

If you get a large refund every year, you're withholding too much—the IRS is holding your money interest-free and giving it back when you file. You can change this by updating your W-4 form at your job. The W-4 tells your employer how much tax to take out of each paycheck.

To adjust it, log into your employer's payroll system or ask your HR department for a new W-4 form. The IRS has a withholding calculator on its website that asks about your income, deductions, and credits and tells you what to enter on the form. If you claim more allowances, less tax comes out each paycheck and your refund shrinks—but you have the money now instead of waiting until April. This is usually the smarter move if you're getting refunds of $2,000 or more.

Update your W-4 if your life changed: you got married, had a child, started a second job, or your spouse started working. These changes affect how much you should withhold. The form takes 10 minutes to fill out and your employer processes it within one or two pay periods.

Correcting income and withholding errors that reduce your refund

If you received a W-2 form from your employer and it shows the wrong income or withholding, that's a problem. Your employer sends a copy to the IRS, and if your tax return doesn't match, the IRS will catch it and either reduce your refund or send you a bill. Ask your employer to issue a corrected W-2 (called an amended W-2) if the numbers are wrong.

The same applies to 1099 forms for side income, freelance work, or investment income. If a 1099 shows income you didn't report, or shows income you did report but the amount is wrong, the IRS will match it to your return. If you received a 1099 in error—for example, a client sent you a 1099 but you were actually an employee—you can contact the issuer and ask them to file a corrected 1099.

If you had multiple jobs during the year, your withholding might be wrong because each employer withholds as if you only work for them. You can fix this by claiming fewer allowances on your W-4 at one job to increase withholding, or by making an estimated tax payment before the year ends. The IRS website has a Multiple Jobs Withholding Calculator to help.

Self-employment income and why it reduces your refund

If you're self-employed or have side income, you owe self-employment tax in addition to income tax. This is Social Security and Medicare tax, and it's roughly 15% of your net profit. Many people don't account for this and expect a refund when they actually owe money.

To calculate it, take your net self-employment income (revenue minus business expenses) and multiply by 0.9235, then by 0.153. That's your self-employment tax. You report this on Schedule SE and add it to your income tax on Form 1040. If you earned $10,000 in side income, you might owe $1,400 in self-employment tax alone, which wipes out any refund from your W-2 job.

You can reduce this by deducting all legitimate business expenses—home office, equipment, supplies, mileage, meals—before calculating self-employment tax. Keep receipts and track mileage. If you expect to owe self-employment tax, you can make quarterly estimated tax payments throughout the year to avoid a large bill at tax time.

Mistakes that create false refunds the IRS will reverse

Some people get large refunds because they made errors on their return. The IRS doesn't catch all of them immediately, but it will eventually. Common mistakes include claiming the same dependent twice, reporting income from a W-2 twice, using the wrong filing status, or claiming a credit you don't may have access to for.

If you claim a child as a dependent and your ex-spouse also claims the same child, the IRS will reject one of the claims and reduce that person's refund. If you report $50,000 in W-2 income but your W-2 shows $60,000, the IRS will match the W-2 and bill you for the difference plus interest. These corrections usually happen within six months to a year, and you'll receive a notice in the mail.

Before you file, double-check that your income matches your W-2s and 1099s, that you're claiming each dependent only once, and that your filing status is correct. If you're married, you and your spouse must file the same way—you can't file married filing separately if your spouse files jointly. A few minutes of review can save you from a bill later.

Frequently Asked Questions

Can I get a bigger refund by claiming more dependents?

No. You can only claim a dependent if they actually may have access to—they must be your child, stepchild, foster child, sibling, or a relative who lived with you all year and you paid more than half their expenses. Falsely claiming dependents is tax fraud and the IRS will catch it when it matches your return to Social Security records. You'll owe back taxes, penalties, and interest.

What if I have investment income or capital gains?

Investment income is taxed differently than wages. Long-term capital gains (assets held over a year) are taxed at 0%, 15%, or 20% depending on your income. Short-term gains are taxed as ordinary income. Dividends and interest are also taxed. Report these on Schedule D and Schedule B. If you had losses, you can deduct up to $3,000 against other income and carry the rest forward to future years.

Does getting married or divorced change my refund?

Yes. Your filing status on December 31 is your status for the whole year. If you got married, you can file married filing jointly (usually better) or married filing separately. If you got divorced, you file single. Married filing jointly often produces a smaller refund or a smaller bill because two incomes are taxed together. Update your W-4 after a major life change.

Can I amend my return to get a bigger refund after I've already filed?

Yes, using Form 1040-X (Amended U.S. Individual Income Tax Return). You have three years from the original due date to file an amended return and claim a refund. Common reasons include finding a deduction you missed, discovering you may have access to for a credit, or correcting an error. File the amended return by mail—the IRS does not accept amended returns electronically yet.

What if I owe money instead of getting a refund?

You can set up a payment plan with the IRS. If you owe less than $25,000, you can request a short-term extension (up to 180 days) with no setup fee, or a long-term installment agreement with a small fee. Visit IRS.gov or call 1-800-829-1040. Paying in full by the due date avoids interest and penalties, but a payment plan is better than not paying at all.