New IRS Interest Rates for Late 2023: What You Need to Know

The Internal Revenue Service (IRS) has announced a significant update regarding interest rates for the fourth quarter of 2023. Starting from October 1, 2023, these changes will impact both individual taxpayers and corporations. This will affect how much you pay on late taxes or get back on refunds.

What’s Changing?

• Individuals: If you overpaid or underpaid your taxes, the interest rate is now 8% per year, compounded daily.
• Businesses: If a business overpaid taxes, the interest rate is set at 7%. But if they overpaid by more than $10,000, it’s 5.5%.
• Large Corporate Underpayments: They’ll pay 10% interest on underpaid taxes.

Why It Matters?

These rates are up because the government’s base rate went up in July 2023. This is important for planning your taxes and understanding potential costs or returns. Have questions about the new IRS rates? We’re here to help you:

• We can figure out your taxes for each quarter so you know exactly what to pay.
• We can estimate how much you’ll owe or receive back from the IRS, taking into account these new interest rates.
• Our team will explain how these rates affect you and your tax planning in a way that’s easy to understand.

Contact us today. At DimovTax, we simplify tax matters for you.