It can be frustrating and confusing to find that the tax refund amount you expected when you filed your return has changed. Many taxpayers eagerly check the IRS “Where’s My Refund?” tool only to discover that their anticipated refund was reduced—or, in some cases, increased. The IRS has a number of reasons why refund amounts may change after filing. Some of these are due to taxpayer errors, while others are related to federal offsets, updated information, or IRS corrections. This blog explores the most common reasons why your refund might change after you’ve filed and what you can do about it.
1. Math Errors or Miscalculations
The IRS checks every return for accuracy. If you made a math error while adding up income, deductions, or tax credits, the IRS will recalculate your return and adjust your refund accordingly. This is one of the most common reasons for a refund change.
Example: You entered your child tax credit as $3,000 when you were only eligible for $2,000 based on your income. The IRS will adjust the credit and reduce your refund by $1,000.
What to do: You will receive a notice explaining the changes. If you disagree, respond with documentation to support your original figures.
2. Federal or State Offsets
Your tax refund may be reduced (or withheld entirely) to pay for debts owed to certain government agencies. This process is handled through the Treasury Offset Program (TOP).
- Past-due federal or state income taxes
- Unpaid child support
- Defaulted federal student loans
- Unemployment compensation repayments
- State court fees or fines
What to do: If your refund was offset, you will receive a notice from the Bureau of the Fiscal Service with details about the agency collecting the debt and how much was withheld. You’ll need to contact the agency directly if you wish to dispute the debt.
3. Incorrect Banking Information
If the bank account or routing number you provided for direct deposit was incorrect, the IRS may have attempted to deposit your refund but failed. This could delay your refund or result in a paper check being mailed instead—often for a lesser amount if additional changes occurred in the meantime.
What to do: Monitor your mail for a paper check and confirm your banking details before filing future returns. If a deposit was made to the wrong account, you’ll need to contact your financial institution.
4. Earned Income Tax Credit (EITC) or Child Tax Credit Adjustments
These refundable credits are closely scrutinized by the IRS due to high error rates and fraud potential. If your income, number of qualifying children, or filing status doesn’t match IRS expectations, the amount of credit granted may be reduced or denied.
What to do: The IRS will send a letter explaining the issue. You may need to provide proof of your child’s residency, relationship, or your earned income to validate the credit claimed.
5. Incomplete or Missing Forms and Schedules
If you forgot to attach a required form or schedule (such as Schedule EIC for the Earned Income Credit or Form 8862 to reclaim a disallowed credit), the IRS may adjust your refund accordingly. They may disallow the credit or deduction and recalculate your refund.
What to do: Submit the missing information promptly if requested by the IRS. Review your return carefully to ensure all required forms are included next time.
6. IRS Corrections or Processing Updates
Sometimes the IRS adjusts your return due to information they receive from third parties, such as W-2s, 1099s, or other tax documents. If your reported income or withholding doesn’t match IRS records, they will adjust your refund and notify you.
Example: You forgot to include a 1099-INT for $800 in interest income. The IRS added it to your return and recalculated your taxable income and refund.
What to do: Always double-check that all income documents are reported. If you believe the IRS added incorrect information, contact them with supporting documents.
7. Identity Verification Requirements
If the IRS suspects identity theft or unauthorized filing, they may delay or reduce your refund until you verify your identity. You may be required to complete Form 14039 (Identity Theft Affidavit) or use the IRS’s Identity Verification Service.
What to do: Respond promptly to any IRS letters requesting verification. Use the secure IRS website or call the identity verification hotline.
8. Recovery Rebate Credit Adjustments
If you claimed a Recovery Rebate Credit (related to COVID-19 stimulus payments) but the IRS believes you already received the full amount through advance payments, they may deny or reduce the credit.
What to do: Compare the IRS’s records with your own to verify if you received prior stimulus payments. If you believe their records are incorrect, file a dispute with supporting documentation.
9. Amended Return or Duplicate Filing
If you submitted an amended return (Form 1040-X) or accidentally filed a return twice, the IRS may revise your refund or delay processing while they sort out the duplicates.
What to do: Track your return using “Where’s My Amended Return?” online. Avoid filing multiple returns for the same year unless you are filing a formal amendment.
10. Changes Due to Legislative Updates or Delays
Tax laws are occasionally updated mid-season—such as retroactive changes to credits or deductions—which may affect how the IRS processes your return and adjusts your refund.
What to do: Stay informed by following IRS announcements. In some cases, the IRS may correct the return automatically and send you the revised refund or adjustment notice.
How Will You Know Your Refund Has Changed?
The IRS will always notify you of a refund change via a mailed notice. This notice explains the reason for the adjustment, the updated refund amount, and any action you need to take.
You can also track refund updates by using the IRS’s tools:
- Where’s My Refund?
- Where’s My Amended Return?
- IRS2Go mobile app
What to Do If You Disagree with the Change
If you believe the IRS made a mistake, you have the right to dispute it. Your options include:
- Calling the IRS at the number listed on the notice
- Sending a written response with documentation
- Filing an amended return if the error originated from your original filing
Always respond by the deadline listed on the notice to preserve your appeal rights and prevent further delays or penalties.
Conclusion: Refund Changes Are Common—Know the Reasons
Having your tax refund adjusted after filing can be disappointing, but it’s a common occurrence due to errors, missing information, or government offsets. In many cases, the IRS provides detailed explanations and even corrects mistakes automatically. The key is to stay informed, check your IRS notices carefully, and respond promptly when action is required. To avoid future refund surprises, double-check your return for accuracy, include all necessary documents, and use trusted tax software or a tax professional.
