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Will the IRS owe me interest on my 2021 tax return?

On Behalf of | Jul 19, 2022 | Uncategorized |

Have you received the refund the Internal Revenue Services owes you on your 2021 taxes? While the overwhelming majority of taxpayers in Washington state have, a small percentage have not. What’s more, the IRS may owe you interest on top of your refund.

Many manual returns remain outstanding

As of early July 2022, the IRS has processed approximately 97% of income tax returns and issued refunds where applicable. However, many manual returns remain unprocessed. According to federal tax law, if you do not receive a refund within 45 days after your return has been filed, the IRS owes you interest on top of your refund. As of July 1, you’ll get even more if you haven’t received your refund. Instead of getting a 4% bonus, you’ll get a 5% bonus on the refund amount that the IRS owes you. Although you won’t get rich off this extra money, the IRS reports that the average amount of interest owed to taxpayers in 2021 was $18. Nevertheless, you are entitled to the extra money if you have not received your refund by the specified date. The IRS only owes you interest if you filed your tax return on time. The IRS has a larger backlog for 2021 returned than it did for the previous year. In some cases, error returns can hold up processing.

How can I eliminate waiting for a refund?

The best advice for dealing with the IRS is to file your return online. Most tax refunds from returns filed online have refunds issued within the initial 21-day reporting period. That means that most individuals who file online will receive their refund in a timely manner. The online filing also gives you an electronic trail that proves your filing status.

Nevertheless, some electronically filed returns may not have been fully processed. Being able to prove he you filed your return, including any photocopies of filed documents, could prove useful when attempting to get a settlement. As with other tax issues, make sure you keep thorough records of any items that affect you to help relieve your tax burden.