The IRS has increased the interest rate for delayed tax refunds for 2022 from 3% to 4%. This apparently went into effect on April 1st, but I just read about it in media reports today.
The IRS pays out interest if they delay your tax refund by more than 45 days. For the standard tax return which is due on April 15th, this means they’ll pay interest for refunds issued on June 1st or beyond. Even if you file early they’ll still only pay based on the due date which is typically April 15th.
(If you overpay your tax estimates, it can be even a year or more until the interest rate starts kicking in, but if you overpay in April toward the prior year’s taxes, the interest rate kicks in less than 2 months. If you file an extension, you won’t get interest until after your tax return is actually filed.)
Some people like paying taxes via credit card to rack up spend, and some even purposefully overpay to that end. If the IRS take a while to process the refund you should get a nice 4% interest on any overpayment. You’ll get a form 1099INT for any interest earned.
Do note, there have been times/years/payments which the understaffed IRS has been very late with refunds, so don’t overpay what you can’t afford to float. In any case, you should be getting a nice interest rate on the late refund which makes it palatable.
People would deliberately file paper returns for this?
No, people file a form 4668 online and pay beyond their tax liability via a credit card.
Funny they owe you they take their sweet time but if you owe them they want it right away
You can also take your sweet time so long as you’re willing to pay interest (including penalty interest)
I don’t recommend it but neither does the IRS recommend being late themselves
I’m still waiting on my tax return from last year. Last year and this year’s were both flagged as possible identity theft. I verified my identity both years and received this year’s return but not last year’s. Very frustrating!
Haven’t received my 2020 ammended return if you owed them they get it from us if they owe us they give it to us when they want whats fair about that
I am waiting on my $600 stimulus money that was returned to them on 2/3/2021. They made me do an amended return for 2020 which they received 7/13/2021 but I am still waiting for my stimulus money will be a year soon. Hope I get interest on that.
I haven’t received last year’s taxes yet. Hell, I haven’t received the last two stimuluse checks yet. I’ve only gotten the first one.
Got Federal But no State still waiting on State taxes.
I got last year’s refund in October. They did pay me interest and I did get a 1099int on it this year. Hoping this year will be quicker.
FWIW – I got my 2020 in March 2022 and 2021 in April 2022. I didn’t really benefit from this rate increase but they were so slow the interest income will hit my 2022 return instead of 2021 so I guess that’s a small win.
C’mon 2022 Refund! I’m in no hurry tho, the longer the delay the more IR I’ll receive! For those in need of their well deserved Refund, I hope you receive it Soon!!
Peace to all.
i did an overpayment last year towards my 2020 return and still haven’t gotten it back, so heed the warning about overpayments
got my 5k in estimated (over)payments for 2021 back last week about 3 weeks after filing. they even threw in an extra $600+ because somehow I made a math mistake related to the CTC (I didn’t). y’all must be doing something wrong