The US Internal Revenue Service (IRS) announced on Thursday, 9 May, 2024, that interest rates will remain the same for the calendar quarter beginning 1 July, 2024.
For individuals, the rate for overpayments and underpayments will be eight percent per year, compounded daily.
Complete list of the new rates:
- Eight percent for overpayments (payments made in excess of the amount owed), seven percent for corporations.
- Five and a half percent for the portion of a corporate overpayment exceeding USD 10,000.
- Eight percent 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 three percentage points.
Generally, in the case of a corporation, the underpayment rate is the federal short-term rate plus three percentage points and the overpayment rate is the federal short-term rate plus two percentage points.
The rate for large corporate underpayments is the federal short-term rate plus five percentage points.
The rate on the portion of a corporate overpayment of tax exceeding USD 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 are computed from the federal short-term rate determined during April 2024.
These details and a comparison with past rates can be found in Revenue Ruling 2024-11, which is scheduled to be published in the Internal Revenue Bulletin 2024-24 on 10 June, 2024.
