The Fastest and Safest Way to Receive a Tax Refund
Direct Deposit is the safest and fastest way to receive a tax refund. Setting up direct deposit is not just quicker and more secure, it’s also a particularly good solution if you don’t have an address where you can reliably receive mail. If you do not have a bank or credit union account, you can explore account options that are safe, affordable, insured and can be opened remotely .
Electronic filing (E-file), including Free File, is the best way to avoid pandemic-related and other paper delays. E-file is faster, easier and more accurate than filing a paper return. Choosing E-file and direct deposit for refunds remains the fastest and safest way to file a complete and accurate income tax return and receive a refund. Most E-filers get their refunds faster and it is often free.
Eligibility for Certain Tax Credits
Learn more and ask questions when preparing your taxes about valuable tax credits that you may be eligible to receive such as:
- The Earned Income Tax Credit (EITC) helps low- to moderate-income workers and families get a tax break. If you qualify, you can use the credit to reduce the taxes you owe – and maybe increase your refund, including persons with disabilities. There are a lot of myths around the EITC, if you qualify don’t miss out on this valuable credit.
- The Child Tax Credit (CTC) is a tax credit with a maximum of $2,000 per qualifying child, of which up to $1,500 is refundable. Learn more about the Child Tax Credit, if you’re eligible, and how to claim the credit.
- If you paid someone to care for your child (or another qualifying person you care for) so you (and your spouse if filing jointly) could work or look for work, you may be able to claim the Child and Dependent Care Credit, a credit for child and dependent care expenses.
- Learn about potential Disability Tax Benefits.
- Education tax credits help with the cost of higher education by reducing the amount of tax owed on your tax return for eligible students. There are two education credits available and each have criteria that much be met.
- Saver’s Credit is available to eligible individuals making eligible contributions toward their retirement through an IRA, employer-sponsored retirement plan or an ABLE account.
- Additional questions about the Recovery Rebate Credit visit IRS’s Frequently Asked Questions page.
Other Tips to Keep in Mind…
Remember, if you received unemployment compensation it is taxable. Some people may have received a Form 1099-G from the agency paying the benefit to them, but some states do not mail this form and you may need to get the electronic version from your state’s website. If you suspect identity theft involving unemployment benefits, the IRS offers guidance on this topic.
IRS offers information and resources in a variety of multilingual and alternative formats.
The Taxpayer Advocate Service (TAS) is an independent organization within the IRS. Their job is to ensure that every taxpayer is treated fairly and that you know and understand your rights. Advocates can help if you have tax problems that you can’t resolve on your own.
Beware of scams! Keep in mind that the IRS doesn’t initiate contact with taxpayers by email, text messages or social media channels to request personal or financial information. Recognize the telltale signs of a scam, how to report tax scams and how to know if it’s really the IRS calling or knocking on your door.
The money you get in this year’s tax refund could help cover necessities like food, bills, rent or mortgage payments. You may also be able to use some or all of your tax refund to open a savings account or an ABLE account if you are eligible. Learn more about ABLE accounts and eligibility by visiting our ABLE National Resource Center. Learn more about using your tax refund to start an emergency fund to kickstart your savings and begin building your financial resiliency.
Finally, if you do choose to use a paid preparer, plan in advance.