# IRS: Interest Rates Stay the Same for Fourth Quarter of 2013

by Terri Eyden on
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*By Jason Bramwell*

Interest rates will remain the same for the calendar quarter beginning on October 1, 2013, the IRS announced September 5.

Interest rates for the fourth quarter of this year will be:

- Three percent for overpayments (2 percent for corporations).
- Three percent for underpayments.
- Five percent for large corporate underpayments.
- One-half percent for the portion of a corporate overpayment exceeding $10,000.

Under the Internal Revenue Code, interest rates are determined on a quarterly basis. For taxpayers other than corporations, the overpayment and underpayment 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, according to the IRS. 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 0.5 of a percentage point.

The interest rates announced by the IRS on September 5 are computed from the federal short-term rate, which was determined during July 2013 to take effect August 1, 2013, based on daily compounding.