PHOENIX — The Internal Revenue Service has announced interest rates for the calendar quarter beginning Oct. 1, 2017.
According to the announcement, rates will remain the same, including:
- Four percent for overpayments (3 percent in the case of a corporation).
- One and a half percent for the portion of a corporate overpayment exceeding $10,000.
- Four percent for underpayments.
- Six percent 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 of a percentage point.
The interest rates announced are computed from the federal short-term rate determined during July 2017, to take effect Aug. 1, 2017, based on daily compounding.
Revenue ruling 2017-18, announcing the rates of interest will appear in Internal Revenue Bulletin 2017-39, dated Sept. 25, 2017.