IRS announces drop in interest rates

The Internal Revenue Service has announced that interest rates for the calendar quarter beginning April 1, 2008, will drop by one percentage point. The new rates will be:

  • Six (6) percent for overpayments [five (5) percent in the case of a corporation];

  • Six (6) percent for underpayments;

  • Eight (8) percent for large corporate underpayments; and

  • Three and one-half (3.5) percent for the portion of a corporate overpayment exceeding $10,000.

    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 new interest rates are computed from the federal short-term rate based on daily compounding determined during January 2008.

    The new rates, as well as historical information about previous rates, appear in Revenue Ruling 2008-10.

    You may like these other stories...

    IRS revokes group’s tax exemption over anti-Clinton statementsGregory Korte of the USA Today reported on Monday that the IRS has revoked the tax-exempt status of a conservative-aligned charity, the Patrick Henry Center...
    Clawback policies vary by company, industry: PwCAccording to a report issued to clients by PwC on April 17, companies have instituted a wide range of so-called clawback policies – with no two exactly alike – in...
    President Obama squeezed under the bar for the highest marginal tax rate on the federal income tax return he recently filed for 2013. But the Commander in Chief, who filed a joint return, couldn't dodge the new 3.8...

    Upcoming CPE Webinars

    Apr 24
    In this session Excel expert David Ringstrom, CPA introduces you to a powerful but underutilized macro feature in Excel.
    Apr 25
    This material focuses on the principles of accounting for non-profit organizations' revenues. It will include discussions of revenue recognition for cash and non-cash contributions as well as other revenues commonly received by non-profit organizations.
    Apr 30
    During the second session of a four-part series on Individual Leadership, the focus will be on time management- a critical success factor for effective leadership. Each person has 24 hours of time to spend each day; the key is making wise investments and knowing what investments yield the greatest return.
    May 1
    This material focuses on the principles of accounting for non-profit organizations’ expenses. It will include discussions of functional expense categories, accounting for functional expenses and allocations of joint costs.