Publication 75, Interest, Penalties, and Collection Cost Recovery Fee
Interest on Refunds and Credits

We may pay interest on tax overpayments that are refunded or credited to your account.

If we determine that a tax, penalty, or interest payment exceeds the amount required by law, we will first credit the amount of the overpayment against any other tax or fee amounts owed to the state. If an excess amount remains, we will refund or credit that amount to the person who made the overpayment.

However, interest is not applied to overpayments if we determine that the overpayment was the result of carelessness or was made on purpose. Also, if you request that we defer action on your claim for refund and we agree to do so, we may require that you waive interest for the period of time the refund is deferred.

Interest charged on refunds issued in error

If we issued a refund to you in error, we may recover the refunded amount by sending you a bill.

Please note: If we find that the refund issued to you in error was not caused by the person or any related party liable for payment of the tax, we will not charge interest until 30 days after the date of the recovery bill we issue to you. There are many reasons we may have issued a refund to you in error, and it is not necessarily caused by you filing a claim for refund.

Revision June 2026