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posted Jun 7, 2022 9:57:35 PM

Why did I have to pay the IRS taxes on interest of $14.50 I made from them? What was the interest on?

I am retired and took no child tax credit. Does the IRS still owe me money?

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3 Replies
Level 15
Jun 7, 2022 10:47:08 PM

Yes interest from the IRS is taxable income just like bank interest.  They paid you interest for taking a long time to pay your refund, probably your 2020 refund or if you amended a return.   

Why are you asking if the IRS owes you more refund?   Did you get your 2021 refund yet?   

Level 15
Jun 8, 2022 4:41:43 PM

report IRS interest on your next tax return.

Level 15
Jun 8, 2022 5:07:39 PM

@southernway41-ou - if your refund is delayed more than 45 days from the day you submit your tax return the IRS is required to pay interest on the refund.  I assume the $14.50 was interest paid to you due to the delayed refund of your 2020 tax return in 2021....that is income to you, no different than any other interest you receive from a bank. bond, etc. 

 

currently, the interest rate paid for delayed refunds is 5%.