Tax withholding
Income tax your employer takes out of each paycheck and sends to the IRS for you, as a prepayment of your yearly tax.
Withholding is a prepayment, not your final tax. When you file your return, you compare the tax you actually owe with what was withheld. If too much was withheld, you get a refund. If too little, you owe the difference.
Your Form W-4 sets how much federal income tax is withheld. Social Security and Medicare taxes are also withheld, but at fixed rates the W-4 doesn't change.
Example
If $250 is withheld from each of 26 paychecks, that is $250 × 26 = $6,500 prepaid. With an actual tax of $6,000, the refund is $6,500 − $6,000 = $500.