Interest rates will remain at seven (7) percent for overpayments, six (6) percent in the case of a corporation, seven (7) percent for underpayments, and nine (9) percent for large corporate underpayments. The overpayment rate for the portion of a corporate overpayment exceeding $10,000 will be four and one-half (4.5) percent.

 

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 (0.5) of a percentage point.

 

The interest rates announced Thursday are computed from the federal short-term rate based on daily compounding determined July 2001.

 

Rev. Rul. 2001-47, announcing the new rates of interest, will appear in Internal Revenue Bulletin No. 2001-39, dated September 24, 2001.