Tax Credits: The Most You Can Get Out Of The IRS

Tax credit

The deadline for the tax for this year is nearly over. As such, April 18th is the last day you have to submit your tax returns for 2022. There is a provision whereby you can ask for a 6-month extension for filing the taxes. However, that too, along with your tax credits, must be informed to the IRS before the deadline day.

Have You Availed Of All The Tax Credits?

According to the IRS, there have at least been 101 MN tax returns already submitted. Of that number, nearly every one of them has already been processed. The IRS further informs that they have already sent over 69 MN tax refunds by April 7th, with payments averaging at about $2878. One of the reasons behind a refund is a miscalculation on the taxpayer’s part that led them to pay too much.

However, you can also manually generate refunds by using the available tax credits. Tax credits are of 2 types: non-refundable and refundable. Tax credits are fundamentally reductions and/or rebates on the taxes you are paying to the agency. An entirely refundable credit will always be available for eligible applicants regardless of the amount of tax paid. Partially refundable credits, however, can have certain conditions as to when they can be claimed and how much you can claim through them.

Non-refundable credits, however, have a limit on the amount that you can get depending on your tax amount. For example, you cannot get more than $1000 as a non-refundable tax credit if your tax amount is $1000. These are more helpful in decreasing owed taxes, reducing them to a possible zero. As a further note, some tax credits are available in both non-refundable as well as refundable portions.