My mother lived and passed away in a good CCRC, with a 90% return policy. California, meanwhile, recently established a rule requiring interest payments on the CCRC entry fee if it was not paid back within a few months.
After my mother died, payment of the entry fee refund was delayed because of the pandemic. As a result, when I got her fee refund, there was a also a substantial interest payment, as well. I asked the CCRC's financial staff to provide me a 1099-I for this interest, but they said they were not required to issue one.
I am assuming this interest should be taxable, as it doesn't fit into any exempt category. But I can't find any discussion of the question online, anywhere: there's lots about the medical deduction, and other issues, but the interest earned on late refunds is not on anyone's radar.
Grateful for anyone's informed input!
