For planet Earth, 2020 has been a challenging year. The pandemic that took center stage this year continues to take lives and remains in community spread in the United States. The economy, workers, and business owners continue to adapt on the fly, making the most of stimulus efforts, a new policy of sustained lower interest rates, and occasionally hopeful numbers on the stock exchange. Swept along with the uncertainty is one of the tried and true artifacts of American life—the tax return.
Each year taxpayers count on their tax refund. With changes in federal tax law in recent years, individual tax returns for middle income workers slimmed down, but the tax refund remains anticipated. In 2020, the Internal Revenue Service (IRS) responded quickly to the emergency environment created by COVID-19 by pushing Tax Day back from April 15 to July 15.
After that, things got wild, and some people are just now receiving their tax refund. If your refund was delayed, there are a number of reasons this year, including:
In an unusual move, the IRS paid interest on individual 2019 tax refunds filed by July 15. For those who experienced delays in their refund—or are still waiting—the IRS paid five percent per year, compounded daily in to the second quarter. For the third quarter ending on September 30, the rate is three percent. By mid-August, almost 14 million taxpayers had received separate interest payments on their delayed refund. The average amount of interest paid was $18.00.
Those interest payments are taxable and anyone who received a payment over $10 should expect to receive a reporting form from the IRS. Even in 2020, some things never change.
Serving local and international clients from offices in Chicago and Cleveland, our experienced tax lawyers at Robert J. Fedor, Esq., LLC help you respond strategically to questions about offshore tax investment or allegations of tax crime. Call 800-579-0997 or contact us today.