Did Uncle Sam just give you $20?
If you just got $20 or so from the your favorite uncle, it’s probably not because he forgot your birthday. If you received a federal refund after April 15th or are still expecting one, you might notice an additional US Treasury deposit in your bank account. If you didn’t request direct deposit for your refund, you might receive an extra check. These payments are interest earned on refunds that were due in the past three months, or still pending. And guess what? This is considered taxable income for 2020.
Be on the lookout if you:
- Are expecting or received a refund, and
- Filed your 2019 Individual Income tax return by July 15th, 2020.
You should also expect to receive a 1099-INT for any amounts of $10 or more in January 2021, so be sure to keep track of this document for filing your 2020 return. The average amount of these interest payments is $18, so don’t be surprised to see just a few dollars or well over $20. But remember, any amount of interest income should be reported. So, if you received less than the $10, be sure to keep a record of the amount received.
IRS News Release: