You all love to receive some unexpected money apart from your hard-earned salaries. Tax refunds are a great way to get some spare funds to spend. A tax refund is the money that has been overpaid to the IRS. To earn a sizeable tax refund, clever tax and financial planning are necessary. This includes using tax credits to your advantage and seeking your spouse’s help while filing your W-4 forms. There are many tips to getting the most out of your tax refunds. Here are some of them:

Reviewing your W-4
Your W-4 form essentially informs your employer of the amount of income tax to be withheld from your salary. The larger the amount of the allowances you claim on the form, the lesser is the income tax withheld, which results in fatter paychecks, but smaller tax refunds or at times no tax refunds. Here are some factors to consider while claiming the number of allowances on your W-4 form.

• Allowances for your spouse and the people in the household that are dependent on you
• Allowance as the head of the household
• Working two or more jobs
• Having a working spouse

Remember that if you claim fewer allowances, you will get a smaller paycheck but an increased tax refund.

Revising your filing status from time to time
Always ensure that you choose the filing status that best suits you to avail a better tax refund.

Your filing status determines your deductions, requirements, credit eligibility, and your tax liability and the amount of tax refund you are eligible to obtain.

In all, there are five filing statuses. Depending on your requirements it enhances your chances of earning a bigger tax refund, an appropriate one needs to be wisely chosen. Many online forums can help you with this decision. If you would rather not transact online, consider getting help from a professional tax consultant.

Claiming earned income tax credit (EITC)
Under certain conditions, self-employed individuals and people that belong in the moderate- to the low-income bracket can claim EITC. To meet the criteria for this, a person should:

• Possess a legit social security number
• Qualify for U.S. citizenship under all conditions
• Provide income proofs of self-employment
• Not be a claimed dependent on another person

Moreover, ensure that you file your tax returns in order to receive EITC, even if you do not owe taxes.

Claiming dependent care credit (DCC)
DCC is calculated based on the amount you contribute to the care of a child or a dependent. The annual expenditure is capped at around $3000 for one child/dependent and at 6000 USD for two children/dependents. Therefore, if your employer provides DCC, consider deducting this amount.

The following are the criteria for an individual to qualify for DCC:

• A dependent ward must be below the age of13 years
• A dependent adult must be physically or mentally incapable of self-care and should reside with you for more than 6 months.
• The same rules apply to a dependent spouse.