The IRS announced this week that its interest rates will remain the same for the calendar quarter beginning July 1, 2024.
For individuals, the rate for overpayments and underpayments will be 8% per year, compounded daily.
Here is a complete list of the new rates:
- 8% for overpayments (payments made in excess of the amount owed),
- 7% for overpayments by 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, interest rates are set quarterly. For taxpayers other than corporations, the overpayment and underpayment rate is the federal short-term rate plus 3 percentage points.
Generally, for corporations 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 May 9 for the next calendar quarter are computed from the federal short-term rate determined during April 2024.
