Darul Iftaa Mahmudiyyah

Should I return the interest to IRS?

Published as Should I return the interest from my tax return to IRS (Internal Revenue Service)? Should I give this money (interest) to some needy people?

· 3 Dhuʻl-Hijjah 1421 AH1 min readFatwa 2406English

Question

I need an advise in reference to interest income which earned by my tax retrun for the year 1998. I'm a resident of Dallas TX in USA and for some reason I didn't get my tax return for the year 1998 in 1999. Last week I received a check from Internal Revenue Service for my 1998 tax return with interest included. Anyway, since I received my money and interest ($284.32)is included which I don't want. My concern is what do I do with this interest income now. Should I return the interest to IRS? or Should I give this money (interest) to some needy people? Please advise me in this regard. May Allah give us reward. Aameen. Jazak Allah Khair

Answer

Interest monies must be given to the poor and needy who are eligible to accept Zakaat without the intention of reward. However, interest received from government institutes, eg. post office could be used to offset government taxes. Interest received from private banks cannot be used to offset taxes. It may be used to offset interest charged from the same bank.

and Allah Ta'ala Knows Best

Mufti Ebrahim Desai
FATWA DEPT.

Answered by
Mufti Ebrahim Desai
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Source: Darul Iftaa Mahmudiyyah — https://askimam.org/public/question_detail/2406
Fatawa SA: https://fatawa.co.za/fatwa/askimam-2406

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