The 5 Essential Tools for Maximizing Your Tax Refund

It's the most wonderful time of the year: tax season! It's like Christmas for accountants! But even though no one loves to pay taxes, filing your tax return can give you a sense of completion and clarity. Knowing how much tax you owe -- or how big of a refund you'll get -- is like an annual check-in for your personal finances.

For many Americans, getting a tax refund from the IRS is good news. According to the most recent IRS data as of Feb. 23, 2024, the average 2023 tax refund was $3,213. This can be a much-appreciated financial windfall that families use to pay off debt, pay bills, boost their savings, or splurge on something fun.

If you want to get the biggest tax refund, it's important to understand how your tax return works, and claim all the deductions and tax credits that you deserve. Let's look at a few essential tools to maximize your tax refund in 2024.

1. IRS Interactive Tax Assistant (ITA)

The IRS website is not always easy to navigate, but fortunately the IRS offers a helpful search tool called the Interactive Tax Assistant (ITA). If you enter simple search terms, like "estimated tax payment" or "standard deduction," it will pull up relevant search results that can help you get the answers you need.

2. Tax Withholding Estimator

One of the biggest reasons why you get a big tax refund (or not) is the amount of tax that gets withheld from your paycheck throughout the year. If you have a surprisingly small refund (or worse: owe taxes), it might be because your withholdings are too low.

Use the IRS Tax Withholding Estimator to see how your tax refund might be bigger (or smaller) based on changes you could make to your W-4 form at work. If your tax withholdings change, your take home pay might be bigger (or smaller). For example, if you decide you want a bigger tax refund, you can change your withholdings to make this happen -- but you might have $100 less in your paycheck each month.

If you're a parent, your withholdings (and your tax refund) might also change depending on the ages of your children. For example, most children no longer qualify for the $2,000 Child Tax Credit after they turn 17. If your withholdings aren't set to the right level, you might end up with a surprise tax bill.

3. Free tax help

Most of the information that people need to maximize their tax refunds is on the IRS website, but it's not always presented in a clear, readable way. The bureaucratic, technical IRS legalese is not always easy to understand. Sometimes even savvy taxpayers need some extra help.

If you have questions about filing taxes, you might qualify to get free tax help so you can file your tax return with confidence. The IRS offers two programs for free tax return preparation help.

Volunteer Income Tax Assistance (VITA)

To qualify for VITA, you need to have an income of $64,000 or less. This program also helps people with disabilities and people who are non-native English speakers/English language learners.

Tax Counseling for the Elderly (TCE)

The TCE program helps people who are age 60 and over, with special support for questions related to retirement income, pensions, and other tax issues for seniors.

Both of these programs are free, with services provided by IRS-certified volunteers. Use the IRS website to search for free tax help near you, based on your ZIP code. Getting free tax help can empower you to understand your tax situation, get the right deductions that you deserve, and file your tax return with confidence.

4. Direct File (in some states, if you qualify)

The IRS is testing a new way for people to file taxes for free, starting with 2023 tax returns, called Direct File. But not everyone can use Direct File yet -- as of the April 2024 tax season, Direct File is still a pilot program, and it's only available in 12 states and for certain taxpayers.

With Direct File, you don't have to use tax software (even free tax software) for your federal return, because you can file "directly" with the IRS. After you file your federal return, if you need to file a state income tax return, the Direct File tool will direct you to an appropriate state-level tax-filing solution for your needs.

Direct File is a good way to maximize your tax refund because it works like tax software, but it's totally free. The exact eligibility requirements for the Direct File pilot program depend on your state and your tax situation; people with the simplest tax returns and common filing statuses are most likely to qualify. Find out more information at the Direct File website.

5. Free File (if your income is below the limit)

Not everyone has to spend money on tax software. If your adjusted gross income (AGI) is $79,000 or less for 2023, you can use IRS Free File to file taxes for free by using tax software from IRS-approved partners. Some of the IRS Free File partners include TaxAct and TaxSlayer, which both made The Ascent's list of best tax prep software companies.

Bottom line

You are not on your own in filing your taxes. If you can't afford professional tax help, you might qualify for IRS Free File, Direct File, or free tax help from IRS-certified volunteers. Whether it's free or paid, use tax software to maximize your refund and have a more peaceful tax season.