IRS raises interest rates for underpayments and excessive payments
Kevin Hassett, the former Chairman of Council of Economic Advisers discusses IRS postponement of tax rule regarding Venmo payments and PayPal payments exceeding $600, and concerns about “Kudlow”.
The IRS For the quarter that begins January 1, 2023, there will be an increase in interest rates for overpayments and underpayments.
Washington, D.C., IRS Headquarters, Feb 25, 2022. (Al Drago/Bloomberg via Getty Images/ Getty Images
Individuals pay more than what is owed at a given rate. taxes owed It will not be fully paid. However, it will be 7% per year compounded daily. This is an increase of 6% from the last quarter.
The federal tax collection agency According to the statement the interest rate on corporate excess payments will rise from 6% – 4.5% for those who have more than $10,000
IRS DELAYS NEW TAX-REPORTING RULE ON VENMO, PAYPAL PAYMENTS OVER $600
IRS 1040 Individual Income Tax Forms (Daniel Acker/Bloomberg via Getty Images/Getty Images
The interest rate for large corporate underpayments amounts to 9%
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According to the Internal Revenue Code, the IRS sets its interest rates quarterly. The federal short-term rate plus 3 percentage points is the basis of individual rates.
The IRS homepage viewed through a magnifying glass (Photo illustration by Rafael Henrique/SOPA Images/LightRocket via Getty Images/Getty Images
Underpayment rates for corporations Individuals are subject to the same rates as individuals for overpayments. The rates for overpayments by companies are however two percentage points higher that the federal short-term rates.
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The new rates will be calculated using the federal short-term rate Beginning in October
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