The IRS has set the following interest rates for overpayments and underpayments:
1. **Individuals**: 7% annually for both overpayments and underpayments, compounded daily.
2. **Corporations**:
– 7% for overpayments.
– 6% for general corporate overpayments.
– 4.5% for corporate overpayments exceeding $10,000.
– 7% for underpayments.
– 9% for large corporate underpayments.
The overpayment and underpayment rates are the federal short-term rate plus three percentage points for non-corporate taxpayers.
Corporations have an underpayment rate of the federal short-term rate plus three points and an overpayment rate of the federal short-term rate plus two points. Large corporate underpayments incur an additional five percentage points, while overpayments exceeding $10,000 are charged an extra 0.5 percentage point.
See IRS Notice.
RJC
