WASHINGTON, D.C. — The Internal Revenue Service (IRS) announced today that interest rates will remain unchanged for the upcoming calendar quarter beginning April 1, 2023. This announcement affects individuals and corporations, who will face different rates for overpayments and underpayments.
For individuals, the interest rate for overpayments and underpayments will be 7% per year, compounded daily. The rate for corporations, on the other hand, will be 6% for overpayments and 4.5% for the portion of a corporate overpayment exceeding $10,000. For underpayments, corporations will face 9% while individuals will face 7%.
According to 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. 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 interest rates announced today are computed from the federal short-term rate determined in January 2023. The full details of the revenue ruling can be found in Revenue Ruling 2023-04, which will appear in the Internal Revenue Bulletin 2023-9, dated February 27, 2023.