

IR-2020-270, December 3, 2020
WASHINGTON — The Internal Revenue Service today announced that interest rates will remain the same for the calendar quarter beginning January 1, 2021. The rates will be:
three (3) percent for overpayments (two (2) percent in the case of a corporation);
one-half (0.5) percent for the portion of a corporate overpayment exceeding $10,000;
three (3) percent for underpayments; and
five (5) 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 October 2020 to take effect November 1, 2020, based on daily compounding.
Revenue Ruling 2020-28PDF, announcing the rates of interest, is attached and will appear in Internal Revenue Bulletin 2020-52, dated December 21, 2020.


