Question

If my tax credit is about $700, should I qualify for a refund? I filed on free1040taxrefunds and am seeing a lot of bad reviews so Im skeptical as to what I saw on there.

Forum|Forum|5 years ago
January 23, 2021
1 reply
0 views

I'm a rideshare/food delivery driver who started last year, so I don't know how the mileage deduction affects refunds. Any help would be appreciated

TurboTax Free Edition Online

M

MAK70

Your gross business income will be the total amount that you collect. Your net business income is the amount after you subtract any expenses- so when you enter the mileage, your taxable income does decrease (which is a good thing),

See Tax Tips for Uber, Lyft, and Other Car Sharing Drivers

G

GreysideAuthor

So does it only decrease the taxable income? The tax credit I got is more than the taxable income, so I'm wondering if I'll get money back based on that. I appreciate you taking the time to respond, thanks!

J

JotikaT2

No.

Tax credits will reduce your total tax liability, not your taxable income. Your taxable income is used to determine your tax rate bracket, which then determines your total taxes due.

Some tax credits are refundable while others are not. If the credit you have is refundable, you will be entitled to a refund for any excess credit over your tax liability.

If however, it is a nonrefundable credit, you can only use it to offset your tax liability. Once your liability is zero, the credit is also done unless there is a carryover provision that allows you to carry it forward to the next tax year.

Tax credits

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