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IRS refunds on the way with an added bonus for some

Many are wondering where the heck is their refund from the IRS. Why you might actually get a larger check because of the wait.

SAN ANTONIO — The IRS had a backlog of 22 million paper tax filings from 2021. That should be cleared by the end of June. Then it will start on the paper returns filed in 2022. It is first in, first out, so you might still have a considerable wait to get that check. The IRS is going to make it worth your wait, but, of course, there is a caveat.

“I recall speaking with someone and it took almost a year for the IRS to process,” said Kemberley Washington a former IRS agent now with Forbes Advisor.

She said the wait can be frustrating.

“Chances are you are going to be waiting a long time,” Washington said.

The IRS has 45 days to send you your refund. The IRS will sweeten your refund if it misses that deadline by paying you extra for waiting longer.

“Those individuals can expect to receive interest on that tax refund and that’s about 5% interest,” Washington said. “So, that’s a little bit higher than you typically receive on a bank account.”

The average refund is $2,800 so you will likely earn about an extra $140. Yet, do not spend all of it.

“If your refund is late and it’s the IRS’ fault, we’re going to pay you interest; however, that interest is taxable income,” said Michael Devine with the IRS.

How much will those taxes be? Depends on your income bracket.

“From 10% to 37% is going to the be the amount that you pay,” Washington said.

That is anywhere from $14 to $52. So, you will still come out ahead. The IRS is keeping track of that extra money. You will get a 1099 form in the mail if you get more than $10 in interest. You will need to report it on your next tax return.

Devine said it is mostly people who did not file electronically who are still waiting on a refund.

“If you filed by paper, it’s going to take a long time," he said. "Someone has to process that paper. They have to turn that information that you wrote on the return and transcribe it and put it into our computer. So, it just takes that much longer.”

His best advice is to be patient.

You can always check your refund status by using the IRS' Where's My Refund? tool. It will tell you if your refund was processed and if your money has been issued.

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