December 19, 2024

4 Ways to Increase Your Tax Refund in 2025

You work hard for your paycheck, and you deserve to keep as much of it as possible. That’s why you should be strategic when filing taxes.

With thoughtful planning and a little know-how, you can maximize your tax refund to get a solid amount of money back at the end of the year.

Here’s how to get the most back on taxes — and why a big tax refund is worth chasing.

What’s a tax refund, and how does it work?

A tax refund is a reimbursement the government gives you if you’ve overpaid in taxes. Depending on your tax situation, you could end up with a good chunk of cash — providing a much-needed boost to your savings or debt payments. But what’s the maximum tax refund you can get, and how do you get it?

There’s no clear maximum to how much you can earn. It all depends on your individual tax profile, which defines how much you pay and how much you might get later. Your profile includes filing status, number of dependents, and deductibles — but there are dozens of other factors that also affect your taxes.

Keep in mind that when you get a refund, you’re still paying taxes. You just get some money back after. It’s your own money coming back to you — so while refunds are exciting, they aren’t actual income.

The key to getting a solid return is knowing the rules and how to make the most of them. Avoid paying taxes late, make sure you do them in the first place, and take your time to avoid mistakes. Then you can learn what credits and deductions you’re eligible for and apply for them accordingly.

How to get money back from taxes: 4 practical strategies

Here are four proven ways to get the biggest tax refund possible:

1. Maximize credits and deductions

Credits directly reduce your tax bill dollar-for-dollar. If you have a $1,000 tax bill and a $500 credit, you only need to pay $500. Common credits include the earned income tax credit for low- to moderate-income workers, the child tax credit for parents, and the American opportunity credit for higher education expenses.

While credits directly lower how much you pay in taxes, deductions reduce the amount of income that’s subject to tax in the first place. This means you're being taxed on a smaller portion of your earnings — which can lead to substantial savings.

There are two main types of deductions: standard and itemized. The standard deduction is a set amount based on filing status, so you can deduct it without having to track a lot of expenses. Everyone is eligible for the standard deduction, regardless of what their annual expenses look like.

For most filers, the standard deduction is the most cost-effective choice. But if you have a lot of expenses in certain categories, itemizing your deductions could save extra money. That means you claim a list of specific expenses rather than opting for the preset standard deduction. Some common itemized deductions include:

Interest paid on mortgages and other housing-related personal loans
State and local taxes
Charitable donations
Medical and dental expenses that exceed 7.5% of your adjusted gross income (AGI), which is your total income minus certain adjustments like student loan interest and retirement contributions

2. Choose the best filing status

Filing status determines your tax rates eligibility for certain credits, deductions, and standard deduction amounts. For most people, selecting your filing status is pretty clear: You’re either single, married filing jointly, or married filing separately. You could also be a single head of household.

Single filers have the smallest standard deduction. But if you’re unmarried and have dependents, you may be able to file as a head of household instead of a single filer. This can make a big difference to the refund because head-of-household filers get a larger standard deduction and better tax brackets.

To qualify as head of household, you must be unmarried, pay more than half the cost of keeping up a home, and have a qualifying child or dependent living with you for more than half the year. That dependent could be a child, sibling, parent, or grandparent. You can file as a head of household if you provide more than half of their living expenses, even if they don’t live with you full-time.

Married couples who file jointly typically qualify for more tax breaks and a higher standard deduction. But they can sometimes come out ahead by filing separately instead. Filing separately makes sense if one spouse has a lot of medical expenses to deduct or has a significant amount of itemized deductions because it could lead to a bigger return.

3. Max out your retirement accounts

Saving for retirement is one of the smartest money moves you can make — and the tax code offers some serious incentives for making it.

When you contribute to a traditional 401(k) or IRA retirement fund, that money doesn’t factor into your taxable income for the year until it goes beyond certain limits. This shields a portion of your earnings from taxes, letting you keep more hard-earned money.

4. Get expert help

Taxes can be complex and confusing — especially if you have multiple sources of income, own a business, or have a lot of investments. While tax software is great for simple returns, taking advantage of personalized, expert advice is one of the best ways to file. Working with a qualified tax professional quickly pays for itself because it saves you time and stress — but they’ll also have better insight into where you qualify for deductions or can retain some earnings.

A Certified Public Accountant (CPA) or other certified tax preparer knows all the latest deductions and credits you qualify for. They can also help you navigate tricky situations like self-employment taxes, capital gains, and rental property income, and guide you on tax-saving tactics, like timing your charitable donations. Plus, a pro can look at past returns and spot opportunities to change them and claim refunds you missed.

Keep your pay flowing with EarnIn

Learning how to maximize your tax return is a great way to improve your finances, but it’s just one part of the bigger picture. To take control of your pay, you need tools that empower you to make smart choices every day. That’s where the EarnIn app comes in.

With the Cash Out feature, you can access your pay as you earn it — up to $150 a day and up to $750 every pay period with no credit checks, no interest, and no membership fees. You’ll have the flexibility you need to cover expenses on your own schedule. No more waiting for payday to take care of your bills. Download EarnIn today.

On top of that, EarnIn’s Credit Monitoring feature is an easy way to make sure you never skip a beat when it comes to your credit score. This powerful tool provides free access to your Vantage Score 3.0® by Experian® and real-time alerts to help you stay on top of your financial health.

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Please note, the material collected in this post is for informational purposes only and is not intended to be relied upon as or construed as advice regarding any specific circumstances. Nor is it an endorsement of any organization or services.

1. EarnIn is a financial technology company not a bank. Subject to your available earnings, Daily Max and Pay Period Max. EarnIn does not charge interest on Cash Outs. EarnIn does not charge hidden fees for use of its services. Restrictions and/or third party fees may apply. EarnIn services may not be available in all states. For more info visit earnIn.com/TOS

2. Calculated on the VantageScore 3.0 model. Your VantageScore 3.0 from Experian® indicates your credit risk level and is not used by all lenders, so don't be surprised if your lender uses a score that's different from your VantageScore 3.0. Learn more: https://www.experian.com/assets/consumer-information/product-sheets/vantagescore-3.pdf