Taxation | The Trusted Professional

IRS: Interest Rates to Stay the Same for the Second Quarter This Year

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The IRS on Mar. 6 announced interest rates will remain the same for the calendar quarter starting April 1.

According to the IRS, for individuals, the rate for overpayments and underpayments will be seven percent per year, compounded daily. 

Here is a complete list of the new rates: 

•7% for overpayments (payments made in excess of the amount owed), 6% for corporations.
•4.5% for the portion of a corporate overpayment exceeding $10,000.
•7% for underpayments (taxes owed but not fully paid).

•9% for large corporate underpayments.

Under the Internal Revenue Code, the interest rate 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, for 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 of more $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 on Mar. 6 are computed from the federal short-term rate determined in January 2025. 

Revenue Ruling 2025-7, which announced the interest rates, is attached and will appear in Internal Revenue Bulletin 2025-13 on Mar. 24.