IRS Interest Rates
The rate the IRS charges on unpaid tax (and pays on refunds), updated every calendar quarter.
Quarterly interest rate history
Every rate below is read directly from the site's central rate table (never hand-typed into this page), so it can't drift out of sync with the calculators that use the same data.
| Quarter | Individual under/overpayment | Corporate overpayment | Large corporate underpayment | Corp. overpayment >$10k (GATT) | Revenue Ruling |
|---|---|---|---|---|---|
| Q3 (Jul–Sep) 2026 | 7% | 6% | 9% | 4.5% | Rev. Rul. 2026-10 |
| Q2 (Apr–Jun) 2026 | 6% | 5% | 8% | 3.5% | Rev. Rul. 2026-5 |
| Q1 (Jan–Mar) 2026 | 7% | 6% | 9% | 4.5% | Rev. Rul. 2025-22 |
| Q4 (Oct–Dec) 2025 | 7% | 6% | 9% | 4.5% | Rev. Rul. 2025-18 |
| Q3 (Jul–Sep) 2025 | 7% | 6% | 9% | 4.5% | Rev. Rul. 2025-11 |
| Q2 (Apr–Jun) 2025 | 7% | 6% | 9% | 4.5% | Rev. Rul. 2025-7 |
| Q1 (Jan–Mar) 2025 | 7% | 6% | 9% | 4.5% | Rev. Rul. 2024-25 |
| Q4 (Oct–Dec) 2024 | 8% | 7% | 10% | 5.5% | Rev. Rul. 2024-18 |
| Q3 (Jul–Sep) 2024 | 8% | 7% | 10% | 5.5% | Rev. Rul. 2024-12 |
| Q2 (Apr–Jun) 2024 | 8% | 7% | 10% | 5.5% | Rev. Rul. 2024-7 |
| Q1 (Jan–Mar) 2024 | 8% | 7% | 10% | 5.5% | Rev. Rul. 2023-22 |
The next quarter (Q4 2026, Oct 1 – Dec 31) has not yet been announced as of this page's last update — the IRS typically publishes each quarter's Revenue Ruling about six weeks ahead of the quarter start, so expect the Q4 2026 announcement in the last one to two weeks of August 2026.
How the rate is set
Under IRC §6621, the IRS recalculates its interest rates every calendar quarter from the federal short-term rate (rounded to the nearest whole percent, based on the prior month's daily compounding):
- Individuals — short-term rate + 3 points, for BOTH underpayments and overpayments.
- Corporations — short-term rate + 3 points for underpayments, but only + 2 points for overpayments.
- Large corporate underpayments ("hot interest") — short-term rate + 5 points, a penalty rate for underpayments the IRS has formally noticed to a C corporation exceeding $100,000.
- GATT rate — short-term rate + 0.5 points, applied only to the portion of a corporate refund exceeding $10,000.
Interest compounds daily under IRC §6622 — not monthly or annually — so the effective annual cost is slightly above the stated rate.
How this interacts with late-filing and late-payment penalties
Interest is separate from — and stacks on top of — the IRS's failure-to-file and failure-to-pay penalties. If you file late AND pay late, you can owe all three: a failure-to-file penalty (5% of unpaid tax per month, capped at 25%), a failure-to-pay penalty (0.5% per month, capped at 25%), and interest on the unpaid tax at the rates above, compounded daily from the original due date until paid.
Use the late filing penalty calculator to combine all three for your own numbers, including the reduced 4.5% failure-to-file rate that applies in any month both penalties overlap, and the statutory minimum penalty for returns filed more than 60 days late.
Frequently asked questions
What is the current IRS interest rate for Q3 (Jul–Sep) 2026?
The individual underpayment and overpayment rate is 7% for Q3 (Jul–Sep) 2026, compounded daily under IRC §6622. This is the rate that applies to unpaid individual income tax and to refunds the IRS pays late — see the full history table above for every quarter back to 2024.
Is the IRS interest rate the same as a late-payment penalty?
No — they're separate and stack. Interest compensates for the time value of unpaid tax and is set quarterly under IRC §6621; the failure-to-pay penalty is a fixed statutory percentage (0.5% per month, capped at 25%) charged on top of interest for simply not paying by the due date. You can owe both at once on the same unpaid balance.
Do I earn interest if the IRS owes me a refund?
Yes, if the IRS doesn't issue your refund within the statutory window (generally 45 days after the filing deadline or the date you filed, whichever is later). The individual overpayment rate matches the individual underpayment rate at 7% for the current quarter — both use the same short-term-rate-plus-3-points formula under IRC §6621(a).
Why do corporations pay a different interest rate than individuals?
IRC §6621 sets different add-ons by taxpayer type: individuals use short-term rate + 3 points for both under- and overpayments, corporations use + 3 points for underpayments but only + 2 points for overpayments, and a "hot interest" rate of + 5 points (currently 9%) applies to large corporate underpayments the IRS has formally noticed. A reduced rate of + 0.5 points (currently 4.5%) — the GATT rate — applies only to the portion of a corporate refund above $10,000.
How often does the IRS interest rate change?
Every calendar quarter. The IRS recalculates the rate from the federal short-term rate roughly six weeks before each quarter begins and publishes it in a Revenue Ruling, so the rate you owe on unpaid tax can differ from one quarter to the next even within the same tax year.
Sources
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