What is a tax return?


Quick Answer

A tax return is the tax form on which one files income taxes with the Internal Revenue Service, explains Investopedia. The term "tax return" can also refer to the process by which the government refunds excess taxes, although this is more commonly known as a "tax refund."

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Full Answer

Every year in which an individual or business earns above a certain level of income, that individual or business must file a tax return, according to Investopedia. Even if filing a tax return is not required, doing so may still be recommended, advises the IRS. For instance, filing a tax return may result in a tax refund through the Earned Income Tax Credit if the individual filing the return worked but did not earn much money.

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