IRS maintains interest rates for the fourth quarter of 2025

Executive summary

The IRS has announced that interest rates will remain unchanged for the calendar quarter beginning Oct. 1, 2025. The rates are 7% for individual taxpayers for both overpayments and underpayments, while corporations face different rates depending on payment status and amount.

IRS interest rate announcement for Q4 2025

The IRS has confirmed that interest rates will remain stable for the fourth quarter of 2025. According to Rev. Rul. 2025-18, the following rates will apply:

Key interest rates:

• Individual taxpayers: 7% for both overpayments and underpayments
• Corporate overpayments: 6% standard rate
• Corporate overpayments exceeding $10,000: 5%
• Corporate underpayments: 7%
• Large corporate underpayments: 9%

The interest rates are determined quarterly under the Internal Revenue Code, based on the federal short-term rate plus set percentage points. For non-corporate taxpayers, both overpayment and underpayment rates equal the federal short-term rate plus three percentage points. Therefore, the interest rate on a tax balance or a tax refund that accrues over multiple quarters may be different for each quarter.

The large corporate underpayment rate applies to C corporations with an underpayment exceeding $100,000 during the applicable tax period.

These rates, computed from the federal short-term rate determined in July 2025, will be officially published in Internal Revenue Bulletin 2025-37, dated Sept. 8, 2025.