The IRS announced that it will increase interest rates for the second quarter of 2022, beginning April 1. The rates will be as follows: 

• 4 percent for overpayments (3 percent in the case of a corporation); 

• 1.5 percent for the portion of a corporate overpayment exceeding $10,000; 

• 4 percent for underpayments; and 

• 6 percent for large corporate underpayments.

 The interest rates for the current calendar quarter, beginning Jan.1, 2022, are: 

• 3 percent for overpayments (2 percent in the case of a corporation), 

• 0.5 percent for the portion of a corporate overpayment exceeding $10,000, 

• 3 percent for underpayments, and 

• 5 percent for large corporate underpayments.  

Under the Internal Revenue Code, the IRS determines 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 were computed from the federal short-term rate determined during January to take effect Feb. 1, based on daily compounding. 

Revenue Ruling 2022-05 PDF announcing the rates of interest, will appear in Internal Revenue Bulletin 2022-10, dated March 7, 2022.