Interest rates will stay the same for the calendar quarter beginning April 1, 2023, the Internal Revenue Service stated Thursday.
The rate for overpayments and underpayments for individuals will be 7% annually, compounded daily. The whole list of the new prices is provided below:
- 7% for overpayments (payments made in excess of the amount owed), 6% for corporations.
- 4.5% for the portion of a corporate overpayment exceeding $10,000.
- 7% for underpayments (taxes owed but not fully paid).
- 9% for large corporate underpayments.
The rate of interest is decided on a quarterly basis in accordance with the Internal Tax Code. The overpayment and underpayment rate for taxpayers who are not companies is equal to the federal short-term rate + 3 percentage points.
In general, the underpayment rate and overpayment rate for corporations are equal to the federal short-term rate + three percentage points and two percentage points, respectively. The federal short-term rate + five percentage points is the rate for big business underpayments. The federal short-term rate + one-half (0.5) of a percentage point applies to the amount of a corporate overpayment of tax that exceeds $10,000 for a taxable period.
The federal short-term rate, which was established in January 2023, is used to calculate the interest rates that were announced.
(Source Credit: This article was originally published by irs.gov : news on February 13h, 2023.)