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Tax Returns and Tax Refunds: How the Two Are Different - CNET

Filing your tax return could get you money back in the form of a tax Refund.

Angela Lang/CNET
This story is part of Taxes 2022, CNET's coverage of the best tax software and everything else you need to get your return filed quickly, accurately and on-time.

Every year, tax season brings a slew of financial terms you probably don't think about the rest of the year, from credits and offsets to deductions and qualifying dependents. It can all be a bit much, so before you dive into the deep end of the tax pool, take a step back to consider the basics: What's the difference between a tax return and a tax refund

The two terms sound similar and can often be conflated -- someone might say their "tax return" has been deposited in their bank account. However, a tax return and a tax refund are actually two different things, and it's important to know the distinction before starting your taxes.

We'll explain the details of each term below so you know the difference, as well as how to find out whether you're getting a refund this year. Also, be aware that April 18, 2022, is the deadline for filing your taxes this year. After you file your tax return, here's how you can track the status of your refund.

What's a tax return?

A tax return is a form you file each year with the IRS that details your adjusted gross income, or AGI, expenses and other financial information. Most of these details come from your W-2 statement that your workplace provides you weeks in advance to file your taxes, but you might also have a 1099 or other form for recording your income. 

Your tax return will include your gross income (which is different from your AGI), how much you've already paid into taxes (through your company's withholding or estimated taxes that you prepaid if you're self-employed) and other important information you'll need to file your taxes.

However, the tax return will also balance deductions for your kids, as well as how much you paid in student loan interest, health care coverage, Roth IRA contributions, home office expenses, business expenses, charitable donations and more. 

You must file a tax return in order to get a refund. However, just because you file a return doesn't mean you'll get a tax refund. 

What's a tax refund?

A tax refund is what's issued to you by the US Treasury if, in the previous year, you paid more in state or federal taxes than you needed to. For example, maybe your workplace withheld more money than was actually needed from your paycheck or you're self-employed and wound up overpaying quarterly estimated taxes. 

The government will reimburse you, or "return," the difference between what you paid and what you owed as a lump sum payment; in other words, your tax return. Also, any deductions on your taxes (see above) can also add to the amount you can expect to receive. Here's how to track your tax refund with the IRS.

After you file your taxes, you'll find out if you're getting a refund.

Sarah Tew/CNET

How will I find out if I'm getting a tax refund?

If you use tax filing software or service , you'll see a final estimate of how much you should receive after you file your tax return (including if you self-prepare). Once the IRS receives your return, they'll send you an email or a text message letting you know your final refund amount. 

Then, after they accept your refund, that means your money is on the way to your bank account or mailbox. You can track your refund from the time you file your taxes until you receive your payment. Note that it can take anywhere from one to three weeks to get your refund back, assuming there are no errors found on your tax return.

For more tax information about your taxes, here are 10 tax changes that could affect the size of your refund. Also, here's how to get your tax return done for free.



This post first appeared on Majorgeeks | #1 Top Software In One Place, please read the originial post: here

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