The IRS pays interest on refunds delayed beyond 45 days from the tax return due date, but only if the delay is the IRS's fault, not yours

The IRS does pay interest on tax refunds, but the conditions are narrow. You earn interest only when the IRS holds your refund longer than 45 days after your return's due date — not the date you filed, but the date the return was due (usually April 15). The interest rate changes quarterly and is set by federal law, not by the IRS. For 2024, the rate is 8 percent per year, compounded daily.

The catch: you only receive interest if the delay was caused by the IRS processing your return slowly or making an error. If you filed late, amended your return, or the IRS had to verify information on your return, the 45-day clock does not start until the IRS receives a complete, correct return. If you owe taxes in other years or have unpaid child support or student loans, the IRS can legally hold your refund to cover those debts — and you will not receive interest during that hold.

Key Takeaways

  • The IRS pays interest only when a refund is delayed more than 45 days after the return's due date, and only if the IRS caused the delay.
  • The interest rate is set by federal law and changes quarterly; for 2024 it is 8 percent per year, compounded daily.
  • If you filed late, amended your return, or the IRS needed to verify information, the 45-day period starts from when they received your complete return, not from April 15.
  • Offsets for back taxes, child support, or student loans stop the interest clock — you will not earn interest while the IRS holds your refund for these reasons.
  • The IRS does not send interest as a separate check; it is added to your refund amount or included in a notice if you are owed interest without a refund.

How the 45-day rule works

The 45-day window is measured from the original due date of your return, not from when you filed it. For most people, that is April 15. If you filed your 2023 return on February 1, 2024, the clock still starts on April 15, 2024 — the date it was due. If the IRS has not issued your refund by May 30, 2024 (45 days later), you may be owed interest from that point forward.

This rule exists because the IRS is supposed to process most returns and issue refunds within 21 days of receiving them. When processing takes longer — because of errors in the return, missing information, fraud checks, or simple backlog — the IRS compensates you for the time your money was held. The interest accrues daily from day 46 onward, compounded at the federal rate.

If you filed your return late, the 45-day period does not begin on April 15. It begins on the date you actually filed. So if you filed on June 1, the clock starts June 1, and you would be owed interest only if the IRS had not issued your refund by July 16. This rule prevents people from filing late and then claiming the IRS owed them interest for delays that were partly their own doing.

When the IRS does not owe you interest

The IRS will not pay interest if the delay was not their fault. Common reasons the interest clock does not start include amended returns, missing information on your original return, and IRS verification requests. If you filed your return but forgot to sign it, or if the IRS asks you to provide documentation to support a deduction, the 45-day period restarts from the date they receive your corrected or complete return.

Offsets are another major exception. If you owe back federal income taxes from a prior year, have unpaid child support, or defaulted on federal student loans, the IRS can legally hold your refund to pay those debts. During the offset period, you do not earn interest. Once the offset is resolved and your refund is issued, interest may apply if the total delay exceeded 45 days, but the calculation becomes complex and depends on when each event occurred.

If the IRS made an error on your return — such as misreading a number you provided — they still owe interest for delays beyond 45 days. The error does not erase your right to interest; it just means the 45-day clock starts from when they received your return, not from when they corrected their mistake.

The current interest rate and how it changes

The IRS interest rate is set by federal law and tied to the federal short-term rate plus 3 percentage points. The rate changes every three months: January 1, April 1, July 1, and October 1. For the first quarter of 2024, the rate was 8 percent per year. Rates have ranged from 3 percent to over 10 percent in recent years, depending on federal interest rates.

Interest is compounded daily, meaning each day's interest is calculated on the principal plus all previously accrued interest. On a $5,000 refund delayed 90 days at 8 percent annual interest, you would earn roughly $100 in interest. The exact amount depends on the number of days in the calculation and the specific dates involved.

You can find the current quarterly rate on the IRS website under "Interest Rates." The rate that applies to your refund is the one in effect during the period your refund was delayed, not the current rate. If your refund was delayed across multiple quarters, the IRS calculates interest using the rate for each quarter separately.

How to know if you are owed interest

The IRS does not automatically notify you that you are owed interest. You have to track it yourself or notice it when your refund arrives. If you received your refund more than 45 days after April 15 (or more than 45 days after you filed, if you filed late), and the delay was not due to an offset or missing information, you may be owed interest.

Check your refund amount against what you expected. If it is higher than your calculated refund, the difference may be interest. The IRS will also send you a notice (usually Form 1040-ES or a letter) if you are owed interest, though this can take weeks or months to arrive. The notice will show the interest calculation and the amount owed.

If you do not receive notice and believe you are owed interest, you can contact the IRS at 1-800-829-1040 or check your account on IRS.gov using the "Get Transcript" tool. This tool shows the dates your return was received and processed, which helps you determine whether the 45-day threshold was crossed.

What happens if the IRS owes you interest but no refund

In rare cases, you may be owed interest even though you are not owed a refund. This happens when the IRS held your money for other reasons — such as processing delays on a return where you owed taxes — and the delay exceeded 45 days. The IRS can issue interest as a separate refund check or apply it to your next year's taxes.

You cannot request that the IRS pay interest in a specific way. They will send it however they process it, which is usually as part of your next refund or as a separate check if no refund is due. If you believe you are owed interest and have not received it within a year of the delay, you can file a claim with the IRS using Form 843 (Claim for Refund and Request for Abatement).

Interest on amended returns and IRS errors

If you filed an amended return (Form 1040-X) and the IRS took longer than 45 days to process it, you may be owed interest on the refund from the amended return. The 45-day clock starts from the date the IRS received your amended return, not from the original due date. Amended returns often take longer to process than original returns, so delays are common.

If the IRS made a calculation error on your original return and issued a refund that was too small, they will recalculate and send you the difference. Interest on that additional refund is calculated from the original due date of your return, not from when they discovered the error. This means you may be owed interest even if the total delay from April 15 to the corrected refund date was less than 45 days, depending on how the IRS structures the calculation.

Frequently Asked Questions

Will I get interest if my refund was delayed because I filed late?

Only if the delay exceeded 45 days from the date you filed, not from April 15. If you filed on June 1 and received your refund on July 10, that is only 39 days, so no interest is owed. If you filed June 1 and received it on August 1, that is 61 days, and you may be owed interest for the 16 days over the 45-day threshold.

Can I claim interest on my tax return next year?

No. The IRS calculates and issues interest on their own. You cannot claim it as income or deduct anything related to it. If the IRS owes you interest, they will send it to you or add it to a future refund without you having to do anything.

What if the IRS held my refund because of an offset?

You do not earn interest during the offset period. Once the offset is resolved and your refund is issued, interest may apply if the total time from the due date exceeded 45 days, but the calculation is complex and depends on the specific dates. Contact the IRS to ask whether interest applies to your situation.

How do I report interest income if I receive it?

Interest paid by the IRS on a refund is not taxable income. You do not report it on your tax return. The IRS will not send you a 1099 form for this interest because it is not considered taxable.

What is the interest rate for 2024?

The rate varies by quarter. For January through March 2024, it was 8 percent per year. The rate changes on April 1, July 1, and October 1 each year. Check the IRS website for the current quarterly rate if your refund was delayed across multiple quarters.