What Is a Tax Credit? Subtract tax credits from the amount of tax you owe. There are two types of tax credits: A nonrefundable tax credit means you get a refund only up to the amount you owe. A refundable tax credit means you get a refund, even if it 's more than what you owe..No provision of this section other than paragraph c 2 shall be construed, however, to deny the credits provided by , 33, b 3 D ii . In addition, notwithstanding the requirement that a nonresident alien must file a timely return in order to receive the benefit of the deductions and credits otherwise .A nonresident alien individual shall receive the benefit of the deductions and credits allowed to him in this sub.le only by filing or causing to be filed with the Secretary a true and accurate return, in the manner prescribed in sub.le F sec. 6001 and following, relating to procedure and administration , including therein all the . - How high your income tax bill will be depends on a number of factors, including your filing status, how much money you make and whether you can claim any tax deductions or credits. Allowances play a special role too. If you 're lo.ng at a W-4 form and you don 't know how many tax allowances to claim, .