IRS: No Change in Interest Rates for Q3 of 2015

Interest rates will remain the same for the calendar quarter beginning on July 1, the IRS announced last week.

According to Revenue Ruling 2015-12, the rates for the third quarter of this year will be:

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

Under the Internal Revenue Code, interest rates are 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, 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 one-half of a percentage point.

The interest rates announced by the IRS on June 4 are computed from the federal short-term rate determined during April 2015 to take effect May 1, based on daily compounding.