You may be online for 2 separate tax refunds this year. This is why.


Taxpayers had a break earlier this year, when the COVID-19 outbreak exploded in the country. In March, the IRS announced that taxes would not be paid on their normal April 15 deadline. Rather, taxpayers would get an additional three months to complete their returns.

Delaying the tax filing deadline undoubtedly eased the stress of the many Americans who were too consumed with pandemic-related concerns to focus on making their returns. But by postponing the filing deadline, the IRS also opened the door to delayed refunds, as taxpayers who took the additional three months to file their taxes, in turn, had to wait so long to recover the money they owed. give back. a result.

But fortunately, the IRS recently announced that it will pay interest on late repayments dating back to the original filing deadline of April 15. This means that those who file a tax return on July 15 can still charge interest on their refunds.

Woman at the laptop opening letter

Image source: Getty Images.

That being said, the interest on those tax refunds will likely come as a separate payment than the refunds themselves. And that is something that filing cabinets should be aware of.

Don’t be confused by two separate payments.

The amount of interest you are entitled to on your refund will depend on when it is issued. For repayments issued between April 15 and June 30, you will earn 5% interest on your overdue money. For repayments issued between July 1 and September 30, you will earn 3% interest.

However, one thing to know is that the interest on your refund is likely to come as a second deposit to the bank account (for those who sign up for direct deposit) or as a second check in the mail. Keep this in mind so that you don’t accidentally ignore that second control or attribute it to spam.

Another thing: don’t expect a big windfall on the repayment interest form. The IRS reports that this year’s average refund is $ 2,762. Now that number could change as more taxpayers complete their returns at the last minute. But if you are owed a refund in that neighborhood, you’re probably looking for between $ 20 and $ 30 in interest, depending on when your refund is issued. That is not a sum to highlight.

Still, at a time when so many Americans are struggling financially, it’s better than nothing. An extra $ 20 or $ 30 could help you shop for groceries for a few days, or help you make the minimum payment on your credit card bill to avoid late payments. Just keep an eye out for that extra money and if it doesn’t come in, contact the IRS to follow up.

The IRS generally issues refunds for electronically filed returns within 21 days, assuming there are no errors with your taxes that need to be resolved first. Filing on paper will mean waiting a lot longer for your refund, and any interest payments due along with it. If you really need money now, an electronic return is the way to go.