The IRS pays interest when your refund is delayed past a set date

The IRS pays interest on tax refunds when it takes longer than 45 days from the date you filed your return to issue your refund. The interest rate changes quarterly and is set by federal law, not by the IRS. For the current quarter, you can find the exact rate on the IRS website under "Interest Rates" — as of 2024, rates have ranged from 8% to 9% annually, though this varies.

Interest accrues daily from the original due date of your return (usually April 15) until the IRS issues your refund. You do not have to do anything to receive it — the IRS calculates and includes it automatically. The amount is usually small, often between $5 and $50 for typical refunds, but larger refunds can earn more.

Not all delayed refunds earn interest. If you filed late, interest starts from your actual filing date, not April 15. If the delay was caused by you — such as sending in missing documents or correcting errors — the 45-day clock may restart, which can reduce or eliminate interest.

Key Takeaways

  • Interest is paid automatically by the IRS when a refund takes longer than 45 days from filing to arrival, with no action needed on your part.
  • The interest rate is set by federal law and changes quarterly; you can find the current rate on IRS.gov under "Interest Rates".
  • Interest accrues daily from the original due date of your return (usually April 15) until the refund is issued, not from the date you filed.
  • Delays caused by missing documents or errors you submitted can restart the 45-day clock and reduce the interest owed to you.
  • The IRS includes interest directly in your refund check or deposit — it appears as part of the total amount, not as a separate payment.

When the 45-day clock starts and stops

The IRS begins counting the 45 days from the date you filed your return, not from April 15. If you filed on February 1, the clock starts February 1. If you filed on June 15, the clock starts June 15. The IRS must issue your refund within 45 days of that filing date to avoid owing interest.

The clock stops when the IRS actually issues your refund — meaning the date it sends your check or initiates your direct deposit, not the date it arrives in your account. If you chose direct deposit and the IRS issued the refund on day 50, you earn interest for 5 days even if the money takes another week to reach your bank.

If you filed your return late (after April 15), the interest clock still starts from your filing date, but interest itself accrues from April 15 backward. This means a late filer who gets a refund on day 60 may owe interest for the period from April 15 to day 60, not just from the filing date forward.

How the interest rate is determined and where to find it

Congress sets the formula for the IRS interest rate, which is the federal short-term rate plus 3 percentage points. The rate is recalculated every three months — on January 1, April 1, July 1, and October 1. The IRS publishes the current rate on its website at IRS.gov, under the "Interest Rates" section.

Interest rates have varied significantly over time. In 2023 and early 2024, rates were between 8% and 9% annually. In 2020 and 2021, during lower interest rate periods, the rate was 3% to 5%. The rate that applies to your refund is the one in effect during the quarter when your refund was issued, not the quarter when you filed.

If your refund spans two quarters — for example, it was issued on March 31 and April 1 — the IRS calculates interest using the rate for each quarter on the days that fall within it. This split calculation is rare but can happen with refunds issued near quarter boundaries.

How much interest you will actually receive

The amount of interest depends on three things: the size of your refund, how many days past 45 the IRS took to issue it, and the interest rate in effect during that period. A $3,000 refund issued on day 60 (15 days late) at an 8% annual rate would earn roughly $10 in interest. A $10,000 refund issued on day 90 (45 days late) at the same rate would earn roughly $100.

The IRS calculates interest using daily compounding, which means interest accrues on the interest as well as on the principal. However, the effect is small for most refunds because the delays are usually measured in weeks, not months. A refund delayed by 30 days will earn noticeably less interest than one delayed by 90 days.

You cannot calculate the exact amount yourself without knowing the precise date the IRS issued your refund, which may differ from the date you received it. The IRS includes the interest calculation in the refund notice it sends you, or you can contact the IRS at 1-800-829-1040 to ask for the breakdown.

When you will not receive interest on a delayed refund

If the IRS delayed your refund because you submitted incomplete or incorrect information, the 45-day clock may restart from the date you provided the missing documents. This means the delay caused by you does not count toward the interest calculation. For example, if you filed on February 1 but did not send in a required document until April 1, the new 45-day period starts April 1, and any delay after May 15 would owe interest.

If you filed your return electronically and it was rejected due to errors, the clock restarts when you resubmit a corrected version. If you filed on paper and the IRS had to contact you for clarification, the clock may restart from the date you responded.

Refunds that are issued within 45 days of filing never earn interest, regardless of the reason for the delay. The IRS also does not pay interest on refunds that are delayed due to fraud investigations or identity theft reviews, though these situations are less common.

How interest appears on your refund check or deposit

The IRS does not send interest as a separate check or deposit. Instead, it adds the interest amount to your refund and includes the total in a single payment. If your refund was $3,000 and you earned $15 in interest, you will receive $3,015 total — either as a check or direct deposit.

The IRS notice that accompanies your refund (or that you can view online through IRS.gov) will show the breakdown: the original refund amount, the interest earned, and the total. If you received a direct deposit, your bank statement will show only the total amount, not the separate components.

If you are expecting a refund and want to know whether interest has been added, you can check the status of your refund using the IRS "Where's My Refund?" tool at IRS.gov. This tool shows the expected refund amount but does not always display interest separately until the refund is actually issued.

What to do if your refund is delayed beyond 45 days

First, check the status of your refund using the IRS "Where's My Refund?" tool at IRS.gov or by calling 1-800-829-1040. This tool tells you whether the IRS is still processing your return, whether it has been issued, or whether there is a problem holding up the refund.

If your refund has been issued but you have not received it after 21 days (for direct deposit) or 28 days (for a check), contact the IRS or your bank. A lost check can be replaced, and a delayed direct deposit can sometimes be traced. Keep records of when you filed and when you received your refund so you can verify the interest calculation later.

If the IRS has not issued your refund after 120 days, you may be able to file a claim for interest under certain circumstances, though this is rare. Contact a tax professional or the IRS directly to discuss your situation. The IRS also publishes guidance on refund delays on its website, including reasons why some refunds take longer than others.

Frequently Asked Questions

Does the IRS pay interest on state tax refunds?

No. Interest on delayed refunds is a federal IRS rule only. State tax agencies have their own rules about interest, and many states do not pay interest on refunds at all. Some states pay interest only if the refund is delayed beyond a certain number of days, which varies by state. Check your state's tax agency website for its specific policy.

What if I owe taxes and also have a refund — do I still get interest?

If you owe federal taxes and are due a refund, the IRS will offset the refund against what you owe before paying you anything. Interest on the refund portion is calculated on the amount actually paid to you, not on the full refund before the offset. You should receive interest on the net amount only.

Can I claim the interest I earned on my refund as income on next year's tax return?

Yes. Interest paid by the IRS on a tax refund is taxable income and must be reported on your next year's federal tax return. The IRS will send you a Form 1099-INT if the interest is $10 or more. Even if you do not receive the form, you are required to report it.

Why did my refund take longer than 45 days but I did not receive interest?

The most common reason is that the 45-day clock restarted because you submitted missing documents or corrected errors. Another possibility is that your refund was issued within 45 days but took longer to arrive in your account — the IRS counts the issue date, not the arrival date. Contact the IRS to confirm the exact issue date of your refund.

Is the interest rate the same for everyone?

Yes. The IRS uses the same interest rate for all taxpayers during a given quarter. The rate does not depend on your income, the size of your refund, or any other personal factor. It is set by federal law and applies uniformly.