Last year, I found out that if I filled out some paperwork and showed it at customs, I could have gotten a refund for the IVA tax paid on my purchases. I didn't do it, but this time around, I would like to. Does anyone have any recommendations? (for example, should I pay with a credit card vs. cash? Can I do it for all purchases I take home or only things purchased at Corte Ingles?) Is this taken care of at customs at the airport? It seems like using a credit card for these purchases and having the IVA tax refunded on the credit card is better for me, since I can't use the euros at home, unless I save them for the next trip. Thanks for any help on this.

I´ve never done it . But most stores will advertise the fact that you can claim back the taxes .
I don´t take back high priced items usually .. but customs at the airport would normally deal with it .
There is paperwork .. which is why I avoid it .
You should make sure you have all the relevant receipts from the store and some stores will provide you with the relevant paperwork for customs at the airport .
Maybe it would be a good idea to speak to someone at the airport ... I´m guessing you´ll be coming into T4 .., when you arrive , and get the documents so that you don´t have to go crazy filling out the details when you leave Spain .

if you shop at one store and spend about 175 Euros on it you can get a refund.
you can read this site for more info worldwide and specific of Spain.and yes you keep all the receipts for customs but for example in El Corte Ingles there is a service that would do the paperwork for you if you do the shopping there.
http://www.globalrefund.com/default.asp?viewSiteId=8
hope it helps