Los Angeles Tax AttorneyLos Angeles – The Internal Revenue Service today announced that interest rates for the calendar quarter beginning April 1, 2008, will drop by one percentage point. The new rates will be:
• six (6) percent for overpayments [five (5) percent in the case of a corporation];
• six (6) percent for underpayments;
• eight (8) percent for large corporate underpayments; and • three and one-half (3.5) percent for the portion of a corporate overpayment exceeding $10,000.
These rates relate to interest on IRS taxes but not on the IRS Tax penalties. Often times, our clients in Los Angeles, Long Beach, Torrance, El Monte, Pasadena and San Jose California area taxpayers are inundated with IRS tax, interest and penalties. Depending on your case, some of your interest and much of your penalties may be reduced. If you require more information contact us at 310 788 9820.
Under the Internal Revenue Code, the rate of interest on IRS tax is determined on a quarterly basis. For taxpayers other than corporations, the overpayment and underpayment of tax rate is the federal short-term rate plus 3 percentage points. Generally, in the case of a corporation tax, the underpayment tax rate is the federal short-term rate plus 3 percentage points and the overpayment IRS tax rate is the federal short-term rate plus 2 percentage points.
The rate for large corporate tax 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.