WASHINGTON - The Internal Revenue Service announced today that interest rates will remain the same for the calendar quarter beginning January 1, 2022. Rates will be:

• 3% for overpayments (two (2) percent in the case of a corporation),
• 0.5% for the portion of a corporate overpayment that exceeds $ 10,000,
• 3% for underpayments, and
• 5% for large corporate defaults.

According to the Internal Revenue Code, the interest rate is determined quarterly. For non-corporate taxpayers, the overpayment and underpayment rate is the federal short-term rate plus 3 percentage points.

In general, for a corporation, the underpayment rate is the short-term federal rate plus 3 percentage points, and the overpayment rate is the short-term federal rate plus 2 percentage points. The rate for large corporate underpayments is the short-term federal rate plus 5 percentage points. The rate on the portion of a corporate tax overpayment that exceeds $ 10,000 for a taxable period is the short-term federal rate plus one-half (0.5) of a percentage point.

The announced interest rates are calculated from the short-term federal rate determined during October 2021 to take effect on November 1, 2021, based on daily compounding.