Many people are astonished to receive an additional deposit designated IRS TREAS 310 INT REF alongside—or after—their tax refund. While it may feel like a bonus, this payment is actually interest paid by the IRS, and unlike your refund, it is taxable income.
If you got IRS interest in 2026, you must declare it on your next tax return. Failure to do so may result in IRS notifications or penalties later.
This guide explains why the IRS pays interest, how to identify INT REF deposits, and exactly how to report them correctly on your tax return.
What Is IRS TREAS 310 INT REF?
IRS TREAS 310 INT REF is a payment made by the United States Treasury when the IRS owes you interest on a delayed refund.
This typically happens when:
- The IRS takes more than 45 days to issue your refund
- Your return required manual review or correction
- You filed an amended return (Form 1040-X)
- Identity verification delayed your refund
- IRS recalculated your refund months later
- Backlogs slowed processing
This interest is calculated automatically and given separately or alongside your refund.
Why the IRS Pays Interest on Refunds
According to federal law, the IRS must repay taxpayers if it holds their money for an extended period of time.
Interest is applied when:
- Refund is issued after the 45-day window from the filing deadline
- IRS delays processing due to internal issues
- Adjustments are made after the original return is processed
- Additional refund amounts are issued later
The IRS pays extra interest for longer delays.
Why IRS Interest Payments Are Taxable
Unlike a tax refund, which is just your money back, interest paid by the IRS is considered income.
This means:
- It must be reported as interest income
- It is subject to federal income tax
- It may increase your taxable income for the year
The IRS treats this interest the same way it treats:
- Bank interest
- Savings account interest
- Bond interest
Even small amounts are technically taxable.
Will the IRS Send You a Form 1099-INT?
Yes—if your interest payment is $10 or more, the IRS will send you Form 1099-INT.
This form will show:
- Total interest paid
- Payer (U.S. Treasury)
- Tax year the interest applies to
The IRS also sends a duplicate of this form to itself, so it knows exactly how much interest you earned.
If your interest is less than $10, you may not receive a form; nonetheless, the amount is still taxable and must be recorded.
How to Report IRS Interest Payments on Your Tax Return
Reporting IRS interest is straightforward.
Step 1: Locate Your 1099-INT
You will receive it in the mail or in your IRS account.
Step 2: Report the Amount as Interest Income
If you are filing Form 1040, report the amount on:
- Line 2b – Taxable Interest
If you have several sources of interest, combine them.
Step 3: Use Schedule B (If Required)
You must file Schedule B if:
- Your total interest exceeds $1,500
- You have multiple interest sources
- You need to list detailed income sources
Otherwise, most taxpayers can enter the amount directly onto Form 1040.
What If You Forgot to Report IRS Interest?
If you forget to report the interest:
- The IRS may send a CP2000 notice
- The IRS may adjust your return
- You may owe additional tax plus interest
To correct this, submit an amended return (Form 1040-X).
Where to Find Your IRS Interest Payment Details
If you did not receive Form 1099-INT, you can still confirm the amount by:
1. Checking Your IRS Transcript
Look for:
- Code 776 — Interest Credit
2. Reviewing Your Bank Statement
Look for:
- IRS TREAS 310 INT REF
3. Logging Into Your IRS Online Account
This gives a full payment history.
Do IRS Interest Payments Affect Refunds or Credits?
Yes, indirectly.
Since IRS interest is taxable:
- It increases your total income
- It may slightly increase your tax liability
- It could affect income-based credits
Most taxpayers, however, will notice only a minor tax impact unless the interest amount is significant.
Common Mistakes Taxpayers Make
Avoid these common errors:
- Assuming IRS interest is not taxable
- Ignoring small amounts under $10
- Forgetting to include 1099-INT
- Confusing refund amounts with interest
- Reporting the wrong tax year
Always report interest in the year you received it, not the year the refund was first provided.
Final Summary
If you received an IRS TREAS 310 INT REF payment in 2026, it indicates that the IRS paid you interest owing to a delay in issuing your return.
Key points to remember:
- IRS interest is taxable income
- It must be reported on your tax return
- Use Form 1040 Line 2b to report it
- You will receive Form 1099-INT if the amount is $10 or more
- Even small amounts must be reported
Understanding how IRS interest works allows you to remain compliant and prevent surprise IRS notices.