The IRS is really slow getting tax refunds out this year. The pandemic, short staff, closed offices and a rush to get economic stimulus payments out meant that tax refunds are languishing in their offices.
The IRS is sorry.
No kidding, they really are. And they are going to pay you some interest to sweeten the deal.
Not only that, but the interest is higher than any bank interest you’re going to find. The best deals for interest payments right now run less than 1.5%, but the IRS is going to go more than triple that and pay 5%
But there are a couple of catches.
The interest is going to be paid for tax refunds that were issued after April 15th. If you got your refund before then, you’re probably not going to get an interest payment.
And the IRS is only paying interest if you file your tax return by July 15th, the due date without extensions for Form 1040.
And one more, the interest will be taxable.
Still, not a bad deal. Just get your tax return filed by July 15th in order to get the interest.
Some other things you need to know about the IRS!