November 24 2021

US Interest Rates on Tax Overpayments and Underpayments Remain Unchanged for Q1/2022

Source: IBFD Tax Research Platform News

US Interest rates on tax overpayments (i.e. tax refunds) and tax underpayments (i.e. tax assessments and late tax payments) will remain the same for the first calendar quarter of 2022 (i.e. 1 January 2021 through 31 March 2022).

The US Internal Revenue Service (IRS) issued Revenue Ruling 2021-24 to announce the interest rates for the new quarter, together with an accompanying News Release (IR-2021-234), dated 23 November 2021.

The interest rates for the first quarter of 2022 are as follows:

  • 3% for non-corporate overpayments;
  • 2% for corporate overpayments up to USD 10,000;
  • 0.5% for the portion of corporate overpayments in excess of USD 10,000;
  • 3% for non-corporate and corporate underpayments (other than large corporate underpayments); and
  • 5% for large corporate underpayments (i.e. underpayments in excess of USD 100,000).

Revenue Ruling 2021-24 also includes:

  • interest factors for daily compound interest for an annual rate of 0.5% (Appendix A); and
  • tables including overpayment and underpayment interest rates for prior periods.

Revenue Ruling 2021-24 will be included in the Internal Revenue Bulletin (IRB) 2021-50, dated 13 December 2021.