Interest rates increase for the first quarter of 2023.
The Internal Revenue Service today announced that interest rates will increase for the calendar quarter beginning Jan. 1, 2023.
For individuals, the rate for overpayments and underpayments will be 7% per year, compounded daily, up from 6% for the quarter that began on October 1. Here is a complete list of the new rates:
- 7% for overpayments (payments made in excess of the amount owed), 6% for corporations.
- 4.5% for the portion of a corporate overpayment exceeding $10,000.
- 7% for underpayments. (taxes owed but not fully paid)
- 9% for large corporate underpayments.
Under the Internal Revenue Code, the rate of interest is determined on a quarterly basis. For taxpayers other than corporations, the overpayment and underpayment rates are the federal short-term rate plus 3 percentage points.