IRS Interest Rates Unchanged for Q3 2021
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.
The interest rates the IRS uses will remain the same for the calendar quarter beginning July 1, 2021.
The Rates Will Be...
3% for overpayments (two (2) % in the case of a corporation),
0.5% for the portion of a corporate overpayment exceeding $10,000,
3% for underpayments and
5% 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 today are computed from the federal short-term rate determined during April 2021 to take effect May 1, 2021, based on daily compounding.
Revenue Ruling 2021-10, announcing the rates of interest, is attached and will appear in Internal Revenue Bulletin 2021-25, dated June 21, 2021.
If you have questions about how this situation affects you, your family, or your business you can always Contact Us or Schedule an Appointment to break things down on an individual level.
As always we hope everyone is staying safe and healthy,
