Withholding

• The U.S. tax system is a pay-as-you-go tax system -- your tax is withheld from each paycheck throughout the year, so you effectively pay your tax in installments. If more tax is withheld than you owe, it is refunded to you when you file your tax returns. Whether or not you get a refund and how much that refund will be is determined by your income, filing status and the amount of tax that was withheld from your check. If you make less than the minimum income requirement for your filing status, your tax is zero and your refund is the total of all tax you paid.
  
  

Unemployment Withholding

• When you sign up for unemployment you must choose whether or not you want taxes withheld from your check. If you need the money now, you can elect not to have the tax withheld. If you choose this option, it does not mean you don't have to pay taxes, you just have to pay them when you file. If your unemployment benefit amount is below the minimum income that requires you to pay taxes, and you choose not to have your taxes taken out, you don't have to file at all.
  
  

Child Tax Credit

• Certain tax credits will help you get a refund even if you don't qualify for one based just on your income and filing status. The Child Tax Credit allows you to reduce your income by an additional $1,000 for each eligible child you have. This credit is in addition to the $3,400 standard dependent exemption you can claim for your eligible dependents. If the tax credit reduces your tax liability to less than what you already paid, you receive a refund of that overage. If you didn't have taxes withheld from your unemployment check, the credit can reduce, or eliminate, what you owe, depending on your income and number of dependents.
  
  

The Earned Income Tax Credit

• The Earned Income Tax Credit allows families with certain income levels to claim this tax credit. The credit is calculated based on your filing status and the number of qualifying children you have. Your eligibility for the credit is based on your adjusted gross income and the number of children you have. For example, if you have three qualifying children, and you are married filing singly, your income cannot exceed $43,352. The amount of your tax credit, in this instance, is $5,666. The IRS offers an interactive EITC assistant which helps you determine your eligibility.