Interest rates will remain the same for the calendar quarter beginning on April 1, the IRS said on Wednesday.
The interest rate for tax overpayments and underpayments for individuals will be 8% per year and 7% for corporations, compounded daily.
Interest rates have stayed at their current levels since the fourth quarter of 2023, when they increased from 7% for individuals and 6% for corporations.
Here is a complete list of the Q2 2024 rates:
- 8% for overpayments (payments made in excess of the amount owed), 7% for corporations.
- 5.5% for the portion of a corporate overpayment exceeding $10,000.
- 8% for underpayments (taxes owed but not fully paid).
- 10% for large corporate underpayments.
Under the Internal Revenue Code, the rate of interest is determined on a quarterly basis. For taxpayers other than corporations, the overpayment and underpayment rate is the federal short-term rate plus 3 percentage points.
Generally, in the case of a corporation, the underpayment rate is the federal short-term rate plus 3 percentage points, and the overpayment rate is the federal short-term rate plus 2 percentage points. The rate for large corporate underpayments is the federal short-term rate plus 5 percentage points. The rate on the portion of a corporate overpayment of tax exceeding $10,000 for a taxable period is the federal short-term rate plus one-half (0.5) of a percentage point.
The interest rates announced on Feb. 21 are computed from the federal short-term rate determined last month. Revenue Ruling 2024-6 contains more information.
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Tags: Income Tax, IRS, Taxes
