Last week, the Treasury Department announced that the Internal Revenue Service will send interest payments to individual taxpayers who filed their 2019 federal income tax returns by the July 15 deadline and are due a refund.
The extension of the 2019 filing deadline to July 15, 2020, due to COVID-19, was considered a disaster-related postponement. When there is a disaster-related postponement, the IRS is required, by law, to pay interest, calculated from the original April 15 filing deadline, as long as an individual files a 2019 federal income tax return by the postponed deadline, which was July 15, 2020. This refund interest requirement only applies to individual income tax filers. Businesses are not eligible.
These interest payments are taxable; therefore, taxpayers must report the interest on their 2020 federal income tax return. In January 2021, the IRS will send a Form 1099-INT to anyone who receives interest totaling at least $10.
For more information, visit IRS.gov.