A Tax Return and Tax Refund Are Not the Same. Here's the Key Differences

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A Tax Return and Tax Refund Are Not the Same. Here's the Key Differences

^{Published on 2025-03-26 11:21:31 - CNET}

Completing your taxes is tricky, especially if you file without the help of tax software or a tax preparer. It can get even more confusing when you see the terms "tax return" and "tax refund" used interchangeably when really, there's a significant difference.

The article from MSN Money explains the distinction between a tax return and a tax refund. A tax return is a form, such as the IRS Form 1040, that individuals file with the IRS to report their income, expenses, and other tax-related information for the year, calculating how much tax they owe or are due a refund. On the other hand, a tax refund is the money returned to taxpayers when they have overpaid their taxes throughout the year, either through withholdings from their paychecks or estimated tax payments. The key differences include that filing a tax return is mandatory for those meeting certain income thresholds, whereas receiving a refund is not guaranteed and depends on overpayment. The article also notes that while a tax return can result in owing money to the IRS if taxes are underpaid, a refund is essentially a return of excess payments made. Understanding these differences helps in managing expectations and financial planning around tax season.

Read the Full CNET Article at:
[ https://www.msn.com/en-us/money/taxes/a-tax-return-and-tax-refund-are-not-the-same-heres-the-key-differences/ar-AA1xq2zi ]

N@N

A Tax Return and Tax Refund Are Not the Same. Here's the Key Differences