Tax Refund: Why was my refund less than I expected?



You had the good fortune to receive a tax refund since you filed your taxes ahead of schedule. What happens, though, if the IRS deposits less money in your account than you anticipated receiving when you filed your tax return? Why your tax refund is smaller than you anticipated may be a mystery to you.

This tax season, returns from the IRS may not match expectations for a number of reasons:

  • The IRS changed how your return’s recovery rebate credit was computed.
  • Your return’s computed child tax credit was modified by the IRS.
  • Due to discrepancies in what was reported to them or changes to specific credits and deductions, the IRS made modifications.
  • As part of the Treasury Offset Program, your refund is reduced.
  • A reduction for unpaid federal taxes from a previous year.

Recent changes made by the IRS

If the amount of your refund is different from what you anticipated, it may be because we corrected any Recovery Rebate Credit or Child Tax Credit numbers on your tax return.

Additionally, it’s possible that all or a portion of your return was utilized (offset) to settle past-due taxes or debts.

If different information was entered for your advanced child tax credit payments than what was actually issued by the IRS, your refund may be less than what was previously anticipated.

Your total 2021 advance payment amount as well as the number of qualified children utilized to determine those advance payments were specified in Letter 6419 from the IRS.

Your refund amount may be adjusted, and there may be delays, if you failed to enter an amount or entered one that differs from the amount the IRS has on record for you for the advance Child Tax Credit installments.

It’s also conceivable that information about your stimulus payments and the RecoveryRebate Credit caused your tax refund to be less than you had anticipated.

Similar to the Recovery Rebate Credit scenario described above, the IRS compares the information on your tax return with the information they have on file for you while processing your tax return.

Any discrepancies will be fixed by the IRS. It is possible that the quantities on your tax return and those reported to the IRS from other sources differ.