What most people can't understand is it's not the "size of the refund" that matters, but the amount of your income you actually pay in taxes for the year.
I'm going to guess that some of this is a result of new withholding tables used by employers. More "take home" pay each week, but with lower withholding. So... when tax time arrives, there's less to get back.
Having said that, for 2018 my gross income increased by about $2,000 over 2017, and my tax obligation actually DECREASED by about $600 or so. Needless to say, I'm pleased with "the Trump tax cut"...
YES! People really don't know how 1040 tax works, do they. YOU HAVE A GOOD GRASP of it.
If a person receives MORE INCOME in their net paycheck due to LESS WITHHOLDING from paycheck, they will have , In theory, less withholding returned to them at end of year. 1040 taxes are to be paid, as you go along, and supposed to be at least 90% of your tax estimated for the year. W-4 form is to help one figure out how many dependents/exemptions they should take. So, if employe takes out LESS withholding, by new tax laws, one is getting their "tax refund' early. IT IS ALL YOUR MONEY.
END OF YEAR..1040 does a reconciliation of your income & expenses for the year.
Credits. One can either have the government "keep" your money till end of year, or..HAVE IT GIVEN TO YOU IN YOUR PAYCHECK, all year long.
So, you can USE your money, save it, invest it, through the year or give it to GOVERNMENT to keep for you without any
interest paid. There is an over all tax % DECREASE . Going by memory. 0....TO 50,000....PAY ZERO TAX.
People who have EARNED INCOME CREDIT...up to about $5,500...and increased CHILD CREDIT, $2,000 per child?, will receive back the most money from FROM ACTUAL GOVERNMENT CASH CREDIT. Child credit was doubled. I don't remember if it was 1 or 2 thousand each child before the doubling.
If you made too much money for EIC & no chidden, and paid in too much W.HOLDING....it will be refunded to you.
It is your own money; either received in pay check, through out the year, or 'saved' by government and paid in one lump sum later.