IRS Announces Quarterly Interest Rates

WASHINGTON - The Internal Revenue Service today announced that interest rates for the calendar quarter beginning October 1, 1994, will increase to eight percent for overpayments, nine percent for underpayments, and eleven percent for large corporate underpayments.

Under the Internal Revenue Code, the rate of interest is determined on a quarterly basis, the rate on underpayments is one percent higher than the rate on overpayments, and the rate for large corporate underpayments is two percent higher than the rate on underpayments. The rate announced today is computed from the federal short-term rate based on daily compounding determined during July 1994.

Rev. Rul. 94-58, announcing the new rates of interest, is attached and will appear in Internal Revenue Bulletin No. 1994-39, dated September 26, 1994.

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