Stitching on tshirts can be tricky and not always easy to do. Every machine is different and what works for one doesn't always work for all. If this is a 100% cotton tshirt, it just may have shrunk.
I'd try the things mentioned below and see if they work for you. You could also try putting the tshirt on a bath towel top side down, spray the back side of the embroidery with a light starch, and iron it on the the back side. This works best if you turn the shirt inside out and put the towel inside the shirt so that the embroidery is facing right side down on the towel.
I think there is a iron on stabilizer. Not sure if I am allowed to give the name here?
Welcome to the Cute family
Have you cut away as much as possible of the stabilizer. Almost sounds as if the stabilizer shrunk during washing.
I do not have any experience in T-Shirt embroidery.
Did you washed and ironed the T-shirt before embroidering?
Did you cut all the jump stitches on the back of your embroidery?
Did you trimmed away all the stabilizer between and around the designs?
I too hate seeing puckering on my embroidery so I understand your frustration.
PS: Did you check the tension on the thread?
With my Janome I have to take down 2 notches from automatic tension when using cutaway stabilizer.
Have you pressed it ?
Really it is not too bad. I have had worse when I started.
Just be careful when you are hooping not to stretch it as the can affect the outcome.
I tend to use double sided sticky tape and only hoop the stabilizer and stick the T shirt down with the tape. That way you can lay it down so much easier.
Don't give up and get frustrated.
Just because people will tell "How it should be done" doesn't always mean you have to do it their way.
You may come up with some way that works for you.
Welcome to Cute. From Australia
Just iron it and noone will notice:):)
Hi Katelyn, and a big Aussie welcome from me. I was just having a look at your picture and can see what you mean. Personally I'm not a fan of Cutaway, but then I don't sew on T-shirt fabric. I was checking out Stablisers on the internet and according to the powers that be, you are using the correct stabiliser for T-shirt fabric. I don't know whether you have cut away the excess piece between the designs or not, maybe that has something to do with the wrinkling. Maybe you didn't have the fabric tight enough in the hoop, there can be a myriad of things that can cause this. I'm hoping someone with more experience with sewing this sort of fabric will come by soon and help. In the meantime check out "How to use stabiliser on T-shirt fabric" on the internet. There are a few videos out there. Good luck, love Chris, Newcastle, Australia.
I am just going to say Welcome to Cute and let someone else answer