I found an unexpected deposit of $7.89 in my checking account recently from “IRS TREAS 310 REF PPD.”

My first thought: scam. I’d received my refund weeks ago, so why was the IRS sending me money, and such a strange amount?

It turns out, I’m one of about 14 million taxpayers who filed their 2019 federal income tax returns by the pandemic-delayed July 15th deadline, and owed a refund.

By law, the IRS owes interest on refunds that accrued between the original April 15th filing deadline and whenever the refund was actually paid. The refunds are for individual taxpayers; businesses are not eligible.

Most of these interest refunds are being issued separately from the tax refunds. The average refund is $18, according to an IRS news release.

Taxpayers who received their refund via direct deposit should find their interest payments deposited in the same account. Everyone else will be sent a check which will have this notation: INT Amount.

Note: If you destroyed the check, assuming it was bogus, the IRS will provide a replacement in about six to eight weeks. Call 800-829-1954 to start the process.

Unlike other refunds from the IRS, which are in round numbers, these interest payments may be for odd amounts, dollars and cents.

These interest payments are taxable and must be reported on your 2020 federal income tax return next year. In January, the IRS will send out Form 1099-INT to anyone who received an interest payment of at least $10.

 




Contributing editor Herb Weisbaum (“The ConsumerMan”) is an Emmy award-winning broadcaster and one of America's top consumer experts. He is also the consumer reporter for KOMO radio in Seattle. You can also find him on Facebook, Twitter, and at ConsumerMan.com.