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10 Most Common Questions About Taxes

        Money | Taxes

9
How Can I Get a Bigger Tax Refund?
Lowering your number of exemptions on your W-4 is one way to get a bigger tax refund. Jeroen Geeraert/iStock/Thinkstock
Lowering your number of exemptions on your W-4 is one way to get a bigger tax refund. Jeroen Geeraert/iStock/Thinkstock

If you work for someone else — let's call it "the man" — then taxes are withheld from each of your paychecks. When you file your tax return in April, you have a chance to claim deductions and credits that lower your total taxable income. If you lower it far enough, Uncle Sam will owe you some of the money that was withheld during the year. That's called a refund!

One way to get a bigger refund is to withhold more money from each paycheck. Talk to your human resources representative and ask to lower the number of exemptions on your W-4 form. Keep in mind, though, that you could probably do smarter things with that money than lend it to the IRS. It won't return with any interest. Consider investing the extra income or using it to pay down debts.

The other way to get a bigger refund is to claim more deductions and credits on your tax return. Every taxpayer is entitled to a standard deduction, but you might be able to trim even more from your taxable income by itemizing your deductions. Keep track of deductible items like mortgage interest, charitable contributions, unreimbursed job expenses, expenses related to a home business, and student loan interest.

If you have a lot of investments, own rental property or operate your own small business, consider hiring a professional tax preparer. They can help you identify potential losses and expenses that may result in a bigger refund.


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