Interest Payments on Tax Refunds from the IRS
Taxpayers that will receive, or have already received, their tax refunds after April 15, 2020 will get interest payments from the IRS.
According to a statement issued by the IRS, individuals that file their 2019 tax returns before the July 15, 2020 deadline and are issued their refund after April 15, 2020 will earn interest on the refund from April 15 to the refund issue date.
Taxpayers may receive the interest payments separately from their tax refunds.
Annual interest rate:
- Second quarter (ending on June 30, 2020): 5% per year, compounded daily
- Third quarter (ending September 30, 2020): 3% per year, compounded daily
Note, the interest payments are considered taxable income on an individual’s 2020 tax return.
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