6

I have seen that the IRS pays overpayment interest rates that seem to range from 3-8%. When I see these rates are they related to what I pay in taxes? I.e. if I vastly overpay my taxes does this mean I will see return rates of 3-8% interest on what I overpaid in?

Example: http://www.irs.gov/pub/irs-pdf/n746.pdf

1
  • From the last page section called "Status of Your Account", I think you will see a check mailed back to you with a tiny bit of interest, but I would let an expert answer.
    – MrChrister
    Commented Oct 15, 2011 at 16:52

1 Answer 1

1

The rates have nothing to do with your tax rate. The rate in those tables is the federal short-term rate, plus 3%.

As for using overpayment of taxes as a high-yield savings account, let us know how that goes. :)

2
  • Am I missing something? 6-11% (with the +3%) is pretty good right? Your last sentence makes me wonder if I'm missing something obvious :) Commented Oct 16, 2011 at 0:13
  • It seems those are for estimated taxes only not withholding unless I am reading it wrong. So if you have them withhold an extra 200 a month you would not get interest on the 2400 return in april.
    – user4127
    Commented Oct 16, 2011 at 22:25

You must log in to answer this question.

Not the answer you're looking for? Browse other questions tagged .