Tax Refund vs. Tax Return
When it comes to taxes, there are a few important terms to understand, including “tax return” and “tax refund.” While these terms are often used interchangeably, they actually have
different meanings. So what is the difference? Here, we explain tax refund vs. tax return.
A tax return is the document that individuals and businesses file with the Internal Revenue Service (IRS) each year to report their income, deductions, and credits. The purpose of a tax
return is to calculate how much tax is owed or how much is due back to the taxpayer. Tax returns are typically due on April 15th of each year, but the deadline may be extended for certain individuals or businesses.
A tax refund, on the other hand, is the amount of money that the taxpayer receives back from the government after filing their tax return. If a taxpayer has paid more in taxes than they owe,
the difference is refunded to them in the form of a tax refund. Tax refunds can be received as a direct deposit to a bank account, a check in the mail, or via a prepaid debit card.
It’s important to note that not everyone will receive a tax refund. If a taxpayer has not paid enough in taxes throughout the year, they may owe money to the government when they file their tax return. In this case, they will not receive a refund, and will instead need to pay the outstanding balance to the IRS.
Another thing to consider is that tax refunds are not immediate, it may take a few weeks or months to receive them. It’s also important to note that if you owe money to the IRS or to state
government you will not receive a refund.
In conclusion, a tax return and a tax refund are two different things. A tax return is the document that individuals and businesses file with the IRS each year to report their income,
deductions, and credits. A tax refund, on the other hand, is the amount of money that the taxpayer receives back from the government after filing their tax return. It’s important to note
that not everyone will receive a tax refund and it may take a while to receive it. It is always a good idea to consult with a tax professional to understand your taxes and how to maximize
your refund.
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“A tax return is the document that individuals and businesses file with the IRS each year to report their income, deductions, and credits. A tax refund, on the other hand, is the amount of money that the taxpayer receives back from the government after filing their tax return.”
