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TAX ON SAVINGS BANK INTEREST-ALL WHAT YOU SHOULD KNOWThe short answer is yes, interest you earn on a savings account is taxable income. The IRS considers most interest income to be a type of. Can you avoid taxes on savings account interest? The short answer to that question is no � not typically, anyway. Generally, both the interest. Generally, the IRS requires you to pay federal taxes on any savings account interest you earn in a given year, regardless of whether it's $1 or $
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