S. 3587 — No Tax on Wrongful Delay Act of 2026

This section establishes an exclusion from gross income for interest paid by the IRS to taxpayers on overpayments under IRC §6611 resulting from (1) an audit under IRC §7602, (2) a taxpayer suit or proceeding for credit or refund of taxes, or (3) a civil action by the United States for tax collection or recovery. The exclusion applies to taxable years beginning after December 31, 2025.