How do regular people get 25k tax return checks? Do you need a crazy high income for that kind of refund?

Large tax refunds like $25k don't necessarily mean someone has a huge income. In fact, it's often more about specific tax credits and life circumstances rather than income level. The most common reasons for large refunds include: - Earned Income Tax Credit (EITC) for lower to moderate-income workers, especially with children - Child Tax Credit, which can be worth up to $2,000 per qualifying child - American Opportunity or Lifetime Learning credits for education expenses - Significant tax withholding throughout the year (essentially overpaying) - Self-employment situations where quarterly estimated payments were too high Your cousin being a nurse with two kids might qualify for several of these credits. Additionally, if she purchased a home last year, made energy-efficient improvements, or had substantial medical expenses, these deductions could increase her refund. Remember though, a large refund essentially means you've been giving the government an interest-free loan. Some financial advisors recommend adjusting your withholding to get smaller refunds but larger paychecks throughout the year.

I was in a similar situation last year trying to figure out why my brother got such a massive refund when I barely broke even. After hours of frustrating research and comparing our situations, I discovered taxr.ai (https://taxr.ai) and it completely changed my understanding of how tax refunds work. The service analyzed my previous returns alongside my brother's (with his permission) and highlighted exactly which credits and deductions I was missing. Turns out I had been filing incorrectly for years! I had eligible education expenses from my nursing continuing education that I never claimed, plus I misunderstood how to report my side hustle income properly. Their explanation feature breaks down exactly how different life situations can lead to vastly different refund amounts - something I never fully understood before. Worth checking out if you're trying to figure out how your cousin got such a big refund.

Guys, I actually tried taxr.ai after seeing it mentioned here, and it was eye-opening! I uploaded my last two years of returns and answered a few questions about my work situation (I'm a teacher with a summer landscaping business). The analysis showed I had completely missed claiming the Educator Expense deduction for the last two years, wasn't properly deducting my business expenses for landscaping, and had been using the wrong filing status after my divorce. I had no idea I qualified for so many credits! I'm not going to get a $25k refund like OP's cousin, but the service identified about $7,300 in missed deductions and credits that I can claim by filing amended returns. Already filed the amendments and the IRS tracker shows they're being processed. Definitely worth checking out if you're confused about why your refunds seem smaller than they should be.

I've seen a few cases of massive tax refunds in my family, and often it's because people couldn't get through to the IRS to resolve issues with previous returns. My aunt had refunds held up for THREE YEARS because of an identity verification issue she couldn't resolve (IRS kept sending letters but never answered the phone). She finally used Claimyr (https://claimyr.com) to actually reach a human at the IRS after trying for months. Check out how it works: https://youtu.be/_kiP6q8DX5c - basically it navigates the IRS phone tree and waits on hold for you, then calls you when an agent is ready. She got through to someone who helped release all her held refunds at once, which totaled over $22k for three years combined. So sometimes these huge refund checks are actually multiple years of refunds that were held up and finally processed together.

I have to eat my words. After expressing my skepticism about Claimyr, I was desperate enough to try it yesterday because I've been trying to resolve an issue with the IRS for MONTHS that was holding up a substantial refund. The service actually worked exactly as described. I provided my number, they called the IRS, and about 1 hour 45 minutes later (while I was going about my day), I got a call connecting me directly to an IRS agent. I didn't have to wait on hold at all - the service did that part for me. The agent was able to verify my identity and release my refund that had been held up due to a mismatch between my married name on my tax return and my maiden name in their system. My refund wasn't $25k, but it was significant enough ($8,650) that I was stressed about it. So yeah, I was wrong, and I apologize for calling it a scam. Sometimes legitimate solutions do exist for these frustrating government bureaucracy problems.

Just to add something no one's mentioned yet - sometimes massive tax refunds happen because of amended returns for multiple years. My colleague discovered he qualified for the Foreign Earned Income Exclusion for the 3 years he worked overseas, which he hadn't claimed originally. He filed amended returns for all three years and got a combined refund of about $32k. So your cousin might have had some kind of multi-year correction situation rather than just a single year huge refund. It's worth asking her if she filed any amendments or had refunds from previous years finally process.

From my experience as a small business owner, there are situations where you might get an unusually large refund. Last year, I estimated my quarterly tax payments based on the previous year's income, but then had a significant business loss in Q4. I had already paid in about $22k in estimated taxes throughout the year but ended up owing much less due to the business loss, resulting in a large refund. Another possibility: if your cousin bought a house last year, there are substantial first-time homebuyer credits in some states that can be combined with federal credits, especially for energy-efficient improvements. These can add up quickly.