In the recent tax season, many Americans are being disappointed by the lack of the expected amount received by them as the 2023 federal tax refund. There have been certain changes that have affected lesser payment amounts being sent to millions of citizens.
In March 2021, the American Rescue Plan was passed which focused on providing households with boosted tax refunds, third stimulus payouts, and benefits on the condition that the recipients had their 2021 taxes in 2022. Over the years, drawing a sharp contrast to what had been aimed at providing citizens, tax refunds are being reversed back to previous conditions of this Plan which has resulted in lesser amounts of payments provided.
The Child and Dependent Credit which was previously provided in the 2021 tax year, was $8,000 for more than 2 or 2 children, while it was $4,000 for a single child. However, now it has come down for 2 or more dependents to $2,100 while $1,050 for a single individual. Such changes in the reduction in amounts of the tax return are also noticed in Recovery Rebate Credit, Child Tax Credit, Earned Income Tax Credit, Cash Charitable Donations, and Self-Employed Sick & Family Leave Credit, of course in variable amounts respectively.
Why Received Reduced Tax Refund?
The Internal Revenue Service had warned taxpayers multiple times of expecting a lesser number of tax refunds for 2023. This comes as a result of claimants who availed the tax refunds in 2022. It has been the changes in tax purveying that have primarily affected the present tax status. Another reason is the Treasury Offset Program, which collects bills that are overdue for both state and federal agencies.