Author Topic: IRS high interest rates  (Read 2069 times)

Offline bhoaem

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IRS high interest rates
« on: September 06, 2019, 03:50:44 PM »
I got a check from the IRS for a revised 2017 tax return. Besides for what I was owed I also got around 7.6% more. On the check its listed as interest.
Does anyone know why I got such a high interest rate?
(I'd love to use them as my savings account. )

Offline dovy2

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Re: IRS high interest rates
« Reply #1 on: September 07, 2019, 09:11:28 PM »
Cool.

Online mendy from lakewood

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Re: IRS high interest rates
« Reply #2 on: September 07, 2019, 09:19:05 PM »
Anyway to overpay with CC and get refunded later with interest plus get CC points? #IRSmethod #newupsmethod
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Offline yelped

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Re: IRS high interest rates
« Reply #3 on: September 08, 2019, 12:59:26 AM »
Anyway to overpay with CC and get refunded later with interest plus get CC points? #IRSmethod #newupsmethod
Yes. It took the IRS a few months to figure out how to release the overpayment back to me and during that time I earned interest on it.

Offline Yammer

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Re: IRS high interest rates
« Reply #4 on: September 08, 2019, 03:27:37 AM »
Yes. It took the IRS a few months to figure out how to release the overpayment back to me and during that time I earned interest on it.
What was the interest rate?

Offline yelped

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Re: IRS high interest rates
« Reply #5 on: September 08, 2019, 08:29:15 AM »
What was the interest rate?
Was about 1% for 3 months.

Offline mushkovits

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Offline ExGingi

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Re: IRS high interest rates
« Reply #7 on: September 08, 2019, 12:33:42 PM »
https://www.irs.gov/newsroom/interest-rates-remain-the-same-for-the-second-quarter-of-2019

Quote
For taxpayers other than corporations, the overpayment and underpayment rate are the federal short-term rate plus 3 percentage points.

Anyway to overpay with CC and get refunded later with interest plus get CC points? #IRSmethod #newupsmethod

WOW, guaranteed 3 points over Federal short-term rate! How long will this last until it is killed like the US Mint.

IRS publishes Revenue Rulings with Applicable rates every month. It's available on the IRS website, but I find it more practical to use http://resources.evans-legal.com/?p=2591

I often refer to the mid-term and long-term numbers as they are important tools in planning, never thought of even looking at the short term rates.

I've been waiting over 5 years with bated breath for someone to say that!
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Offline KSMH

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Re: IRS high interest rates
« Reply #8 on: September 08, 2019, 12:53:49 PM »
WOW, guaranteed 3 points over Federal short-term rate! How long will this last until it is killed like the US Mint.

IRS publishes Revenue Rulings with Applicable rates every month. It's available on the IRS website, but I find it more practical to use http://resources.evans-legal.com/?p=2591

I often refer to the mid-term and long-term numbers as they are important tools in planning, never thought of even looking at the short term rates.
I should file my taxes asap, I overpaid like crazy.
Always praying for delayed baggage.

Offline ExGingi

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Re: IRS high interest rates
« Reply #9 on: September 08, 2019, 12:56:15 PM »
I should file my taxes asap, I overpaid like crazy.

Why would you rush to file? Is there any other place that you can park your money for a safe guaranteed rate which is currently at about 4.8%? On the contrary, leave it there for as long as you don't find a better place for it. I am seriously considering telling someone about this concept. Earn in excess of 4% APR between April and October, with no FDIC insurance limits!

The question for accountants (or anyone else that might know the answer) is whether overpayment interest credit would start accruing from time of payment or from the due date of return. What if one overpaid estimated taxes on Jan 2? What if one had a significant overpayment and filed even later than October 15th?
« Last Edit: September 08, 2019, 01:01:04 PM by ExGingi »
I've been waiting over 5 years with bated breath for someone to say that!
-- Dan

Offline bhoaem

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Re: IRS high interest rates
« Reply #10 on: September 08, 2019, 01:36:26 PM »
Why would you rush to file? Is there any other place that you can park your money for a safe guaranteed rate which is currently at about 4.8%? On the contrary, leave it there for as long as you don't find a better place for it. I am seriously considering telling someone about this concept. Earn in excess of 4% APR between April and October, with no FDIC insurance limits!

The question for accountants (or anyone else that might know the answer) is whether overpayment interest credit would start accruing from time of payment or from the due date of return. What if one overpaid estimated taxes on Jan 2? What if one had a significant overpayment and filed even later than October 15th?
Yup. Had I known I would get that much I would have sent in the revised return as close to the 3 yr limit as possible.

Offline ExGingi

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Re: IRS high interest rates
« Reply #11 on: September 08, 2019, 01:42:06 PM »
Yup. Had I known I would get that much I would have sent in the revised return as close to the 3 yr limit as possible.
I think this can also be leveraged nicely.
I've been waiting over 5 years with bated breath for someone to say that!
-- Dan

Offline aarony

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Re: IRS high interest rates
« Reply #12 on: September 08, 2019, 02:22:44 PM »
IRS does not pay interest unless they held up your refund.

If IRS pays you interest, then interest on the refund will start on the return due date, late filed return received date, or date the payment was made, whichever is the latest. The return due date is generally April 15.

Offline yelped

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Re: IRS high interest rates
« Reply #13 on: September 08, 2019, 02:52:36 PM »
IRS does not pay interest unless they held up your refund.

If IRS pays you interest, then interest on the refund will start on the return due date, late filed return received date, or date the payment was made, whichever is the latest. The return due date is generally April 15.
Thank you. That explains why I got interest in my situation, which was due to the first few people not knowing how to release my refund.

Offline ExGingi

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Re: IRS high interest rates
« Reply #14 on: September 08, 2019, 03:23:54 PM »
IRS does not pay interest unless they held up your refund.

If IRS pays you interest, then interest on the refund will start on the return due date, late filed return received date, or date the payment was made, whichever is the latest. The return due date is generally April 15.
How does an amended return come into play? If a refund is owed after filing an amended return, does that earn interest?
I've been waiting over 5 years with bated breath for someone to say that!
-- Dan