Home | Tax Blog | Tax Evaluation | Resources | Common Tax Questions | Back Taxes | Contact Us

IRS Lowers Interest Rates for Taxpayers in Debt

September 12th

tax debt interest rateInterest can often be the most crippling part of owing back taxes. It can accrue to staggering proportions in remarkably little time, leaving taxpayers with colossal amounts of debt that can never be repaid.

Under tax code regulations, interest rates must be reviewed on a quarterly basis. Typically overpayment and underpayment interest rates for all taxpayers, except corporations, stand at the federal short-term rate plus three additional points. Corporate rates are usually the federal short-term rate plus three points for underpayment and the short-term rate plus two additional points for overpayment. However, this year, there is good news for taxpayers struggling with tax debt or unpaid taxes.

Tax Debtors Get A Break

Current news suggests that interest rates are about to be lowered for American taxpayers, both individual and corporate. The Internal Revenue Service announced last week that they have lowered interest rates for the fourth calendar quarter of 2011. This means that those owing back taxes will face less of a penalty and interest burden than they normally would.

The new interest rates are as follows:

  • Three percent interest on individual overpayments
  • Two percent interest on corporate overpayments
  • Three percent interest on most underpayments, except those owed by large corporations
  • Five percent interest for underpayments owed by large corporations
  • 0.5 percent of any overpayment amount in excess of $10,000

The new interest rates have been computed in accordance with the federal short-term rate as it was calculated during July 2011. They are due to come into effect on October 1, 2011.


Subscribe Now

Follow on FaceBook
News & Events
Monday, August 01, 2011

We are excited to launch our new site LeeTaxHelp.com.
Monday, September 05, 2011

If you think you might be need the advice of a Dallas Bankruptcy Attorney you can view on sister site at http://leebankruptcy.com
Back Taxes (5) General Tax Information (65) News (39) Payroll Taxes (5) Tax audit (10) Tax Debts (3) Tax deductions (16) Tax Fraud (4) Tax Laws (14) Tax Liens (10) Tax payment plans (14) Tax programs (21) Tax Scams (6) Uncategorized (2)
Recent Posts
Advantages of Using a Tax Debt Lawyer
Tax Debt Relief In 2014
Tax Debt Installment Agreements
Understanding the Five Tax Debt Strategies
Back Taxes: What You Can Do
January 2014
December 2013
November 2013
October 2013
September 2013
August 2013
July 2013
June 2013
May 2013
April 2013
March 2013
February 2013
January 2013
December 2012
November 2012
October 2012
September 2012
August 2012
July 2012
June 2012
May 2012
April 2012
March 2012
February 2012
January 2012
December 2011
November 2011
October 2011
September 2011
August 2011