Interest rates decrease for the third quarter of 2019

IR-2019-103, June 5, 2019

WASHINGTON —The Internal Revenue Service today announced that interest rates will decrease for the calendar quarter beginning July 1, 2019.  The rates will be: 

  • five (5) percent for overpayments [four (4) percent in the case of a corporation];
  • two and one-half (2.5) percent for the portion of a corporate overpayment exceeding $10,000;
  • five (5) percent for underpayments; and
  • seven (7) percent 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 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. 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 (0.5) of a percentage point.

The interest rates announced today are computed from the federal short-term rate determined during April 2019 to take effect May 1, 2019, based on daily compounding.

Revenue Ruling 2019-15 (PDF), announcing the rates of interest, is attached and will appear in Internal Revenue Bulletin 2019-26, dated June 24, 2019.