The interest rate the IRS charges for underpayments and pays on overpayments (refunds) varies and is set quarterly. For individuals, these rates are generally the same for both scenarios.
For the year 2022, the IRS interest rates for individuals were as follows:
IRS Interest Rates for Individuals (2022)
| Quarter (2022) | IRS Interest Rates for Individuals |
|---|---|
| 1st Quarter (January to March) | 3% |
| 2nd Quarter (April to June) | 4% |
| 3rd Quarter (July to September) | 5% |
| 4th Quarter (October to December) | 6% |
It's important to note that these rates apply to the specific quarters mentioned. The IRS determines these rates based on the federal short-term rate, plus 3 percentage points. These rates can change each quarter, reflecting economic conditions.
For the most current interest rates or detailed information on how interest is calculated, you can always refer to official IRS publications or a reputable tax resource like TurboTax.
