The biggest refund comes from claiming every credit and deduction you actually may have access to for, not from tricks or shortcuts

A larger tax refund means you paid too much tax during the year and the IRS is returning the overpayment. You cannot create money that was never withheld. What you can do is make sure you claim every credit and deduction that applies to your situation—many people leave thousands on the table by missing deductions they may have access to for or not knowing about credits that exist.

The IRS does not volunteer information about credits you might have missed. You have to know they exist, understand whether you meet the requirements, and claim them on your return. The same applies to deductions. This guide walks through the most commonly missed opportunities and how to learn about they apply to you.

Key Takeaways

  • Tax credits reduce the tax you owe dollar-for-dollar, while deductions reduce the income you report—credits are almost always worth more and should be your first priority.
  • The Earned Income Tax Credit (EITC) and Child Tax Credit are the two largest credits most people miss, and you must claim them on your return to receive them.
  • Common deductions people overlook include student loan interest, educator expenses, and charitable donations, each of which can lower your taxable income.
  • Using tax software that asks detailed questions about your life situation catches more credits and deductions than filing a simple return, and most free options are thorough enough.
  • If you think you missed a credit or deduction in a prior year, you can file an amended return (Form 1040-X) going back three years.

Understand the difference between credits and deductions

A tax credit reduces the tax you owe by the exact dollar amount of the credit. A $500 credit means $500 less tax owed. A deduction reduces the income you report to the IRS, which then lowers the tax you owe based on your tax bracket. A $500 deduction might lower your tax by $100 to $150, depending on your bracket.

This means credits are almost always more valuable than deductions of the same size. If you have limited time or money to spend on tax preparation, prioritize finding credits first. The IRS publishes a full list of available credits on its website under "Tax Credits" in the individual section.

Check whether you may have access to for the Earned Income Tax Credit

The Earned Income Tax Credit (EITC) is a refundable credit, meaning if the credit is larger than the tax you owe, the IRS sends you the difference. It is one of the largest credits available and is designed for people with low to moderate income who work.

You must have earned income (wages, self-employment income, or certain other work-related income) to claim it. The income limits and credit amounts change each year. For 2023, the maximum credit ranged from $560 for people with no children to $3,995 for people with three or more children, but these amounts vary by year and filing status. The IRS EITC page has a tool that tells you whether you likely may have access to and what amount you might receive.

Many people do not claim the EITC because they do not know it exists or think they earn too much. If you work and your income is below roughly $60,000 (the exact limit depends on filing status and number of children), you should check. The IRS estimates millions of people miss this credit every year.

Claim the Child Tax Credit and other child-related credits

The Child Tax Credit is $2,000 per may have access to child under age 17. To claim it, the child must be your dependent, have a valid Social Security number, and meet relationship and residency tests. This credit is partially refundable, meaning you may receive a refund even if you owe no tax.

Related credits include the Credit for Other Dependents ($500 per dependent who does not may have access to for the Child Tax Credit) and the Child and Dependent Care Credit (up to $3,000 in care expenses if you paid for childcare so you could work). These are separate from the Child Tax Credit and have different rules, so check whether you may have access to for each one.

If you have a child born late in the year, adopted a child, or had a change in custody, make sure the child's information is correct on your return. Errors here are common and can delay your refund or trigger an IRS notice.

Look for education-related credits and deductions

If you or a dependent paid for higher education, you may may have access to for the American Opportunity Tax Credit (up to $2,500 per student per year for four years), the Lifetime Learning Credit (up to $2,000 per return per year), or the Tuition and Fees Deduction (up to $4,000 in deductions). You cannot claim both a credit and a deduction for the same expenses in the same year, so you need to calculate which gives you the larger benefit.

You can also deduct up to $2,500 in student loan interest paid during the year, even if you do not itemize deductions. This is a common deduction people miss because it does not require you to itemize and the IRS does not remind you about it.

If you are a teacher or educator who spent your own money on classroom supplies, you can deduct up to $300 of those expenses. This deduction is often overlooked because it is small and applies to a specific group.

Itemize deductions if they exceed the standard deduction

You can either take the standard deduction (a flat amount based on your filing status) or itemize deductions (add up specific expenses and deduct the total). For 2023, the standard deduction was $13,850 for single filers and $27,700 for married filing jointly, but these amounts change each year.

Common itemized deductions include mortgage interest, state and local taxes (capped at $10,000), charitable donations, and medical expenses above 7.5% of your income. If your itemized deductions add up to more than the standard deduction, itemizing saves you money. Many people automatically take the standard deduction without calculating whether itemizing would be better.

Charitable donations are one of the most frequently missed itemized deductions. Keep receipts or bank statements showing donations to may have access to charities. If you donated a car or other property, you need a written acknowledgment from the charity.

Use tax software that asks detailed questions about your situation

Free tax software from the IRS Free File program or from providers like IRS Free File partners walks you through your situation with questions designed to catch credits and deductions. These programs ask about dependents, education expenses, childcare costs, charitable donations, and other life events that trigger credits or deductions.

A simple return filed on paper or with minimal software often misses opportunities because nobody asks about them. The software does not make decisions for you—it asks questions, and you answer based on your actual situation. If you answer honestly and completely, the software will identify most credits and deductions you may have access to for.

If your situation is complex (self-employment income, rental property, significant investment income, or multiple states), consider paying for a tax professional. The cost is often less than the refund you gain by catching credits and deductions you would have missed.

File an amended return if you missed something in a prior year

If you filed a return in a prior year and later realized you missed a credit or deduction, you can file an amended return using Form 1040-X. You have three years from the original due date of the return to file an amended return and claim a refund for missed credits or deductions.

For example, if you filed your 2022 return in April 2023 and in 2024 realized you missed the EITC, you can file Form 1040-X for 2022 and claim the credit. The IRS will process the amended return and send you the refund you are owed. Amended returns typically take longer to process than original returns—expect 8 to 12 weeks or more.

Do not file multiple amended returns for the same year unless the IRS asks you to. If you realize you made another mistake after filing one amended return, wait for the IRS to process the first one, then file a second amended return if needed.

Frequently Asked Questions

Can I claim a credit or deduction if I do not have a receipt?

For most deductions, the IRS requires documentation. For charitable donations, you need a receipt from the charity or a bank statement showing the donation. For medical expenses, you need receipts or bills. For education expenses, you need a Form 1098-T from the school or tuition statements. Without documentation, you cannot claim the deduction if the IRS asks for proof.

What if I claimed a credit or deduction I was not supposed to claim?

File an amended return (Form 1040-X) to correct the error. If you owe additional tax as a result, you will receive a bill. If you overpaid tax, you will receive a refund. Filing an amended return is better than waiting for the IRS to catch the error, which can result in penalties and interest.

Does the IRS tell me which credits I may have access to for?

No. The IRS does not contact you to tell you about credits you might may have access to for. You have to know they exist and claim them on your return. Tax software helps by asking questions, but the responsibility to claim credits is yours.

If I get a larger refund, will the IRS audit me?

A larger refund does not trigger an audit by itself. Audits are based on the content of your return and whether the IRS has reason to question specific items. If you claim credits and deductions you actually may have access to for and have documentation to support them, a larger refund is not a problem.

Can I claim a credit or deduction for something I paid for in a different year?

Generally, no. You claim a credit or deduction in the year you paid the expense or incurred the cost. If you paid tuition in December 2023 for a spring 2024 semester, you claim the education credit on your 2023 return, not your 2024 return. Check the specific rules for each credit or deduction, as some have exceptions.