What determines the refund amount a taxpayer receives?

The refund amount a taxpayer receives is determined by the difference between the total taxes withheld from their paycheck throughout the year and their total tax liability after accounting for any applicable credits. If a taxpayer has more taxes withheld than they owe, the difference results in a refund. This is a fundamental aspect of how the tax system operates, where withholding serves as a prepayment of the taxpayer's annual tax liability.

While factors like filing status and income can influence tax liability and withholding, they do not directly determine the refund amount itself. Similarly, the type of tax credits claimed can reduce the amount of tax owed, which can in turn affect the refund, but it is the net effect—the relationship between the withheld taxes and final tax liability—that ultimately dictates whether a refund is issued and to what extent.