IRS Drop in Interest Rates in First Quarter 2009
As most people who owe the IRS know, the IRS interest rates are extremely high – or at least they feel like it every month when they look at the statement the IRS sends them showing how much they still owe. But, there is some relief in site. IRS interest rates are set out on a quarterly basis. The IRS recently announced that the interest rates beginning on January 1, 2009 will drop by at least 1%. Here is a run down of the new rates:
- 5% for overpayments (4% in the case of a corporation)
- 5% for underpayments
- 7% for large corporate underpayments
- 2.5% for the portion of a corporate overpayment exceeding $10,000.
For taxpayers other than corporate entities (like people), the underpayment rate is the Federal Short Term Interest Rate plus 3% and the overpayment interest rate is the Federal Short Term Rate plus 2%. Here’s a link where you can check out what the current Short Term Applicaable Federal Rates are.