rr-03-126.pdf

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Section 6621.--Determination of Interest Rate

26 CFR 301.6621-1: Interest rate.

Interest rates; underpayments and overpayments. The rate of
interest determined under section 6621 of the Code for the
calendar quarter beginning January 1, 2004, will be 4 percent for
overpayments (3 percent in the case of a corporation), 4 percent
for underpayments, and 6 percent for large corporate
underpayments. The rate of interest paid on the portion of a
corporate overpayment exceeding $10,000 will be 1.5 percent.

Rev. Rul. 2003-126

Section 6621 of the Internal Revenue Code establishes the
rates for interest on tax overpayments and tax underpayments.
Under section 6621(a)(1), the overpayment rate beginning
January 1, 2004, is the sum of the federal short-term rate plus 3
percentage points (2 percentage points in the case of a
corporation), except the rate for the portion of a corporate
overpayment of tax exceeding $10,000 for a taxable period is the
sum of the federal short-term rate plus 0.5 of a percentage point
for interest computations made after December 31, 1994. Under
section 6621(a)(2), the underpayment rate is the sum of the
federal short-term rate plus 3 percentage points.
Section 6621(c) provides that for purposes of interest
payable under section 6601 on any large corporate underpayment,
the underpayment rate under section 6621(a)(2) is determined by
substituting "5 percentage points" for "3 percentage points."
See section 6621(c) and section 301.6621-3 of the Regulations on
Procedure and Administration for the definition of a large
corporate underpayment and for the rules for determining the

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applicable date. Section 6621(c) and section 301.6621-3 are
generally effective for periods after December 31, 1990.
Section 6621(b)(1) provides that the Secretary will
determine the federal short-term rate for the first month in each
calendar quarter.
Section 6621(b)(2)(A) provides that the federal short-term
rate determined under section 6621(b)(1) for any month applies
during the first calendar quarter beginning after such month.
Section 6621(b)(2)(B) provides that in determining the
addition to tax under section 6654 for failure to pay estimated
tax for any taxable year, the federal short-term rate that
applies during the third month following such taxable year also
applies during the first 15 days of the fourth month following
such taxable year.
Section 6621(b)(3) provides that the federal short-term
rate for any month is the federal short-term rate determined
during such month by the Secretary in accordance with
§ 1274(d), rounded to the nearest full percent (or, if a multiple
of 1/2 of 1 percent, the rate is increased to the next highest
full percent).
Notice 88-59, 1988-1 C.B. 546, announced that, in
determining the quarterly interest rates to be used for
overpayments and underpayments of tax under section 6621, the
Internal Revenue Service will use the federal short-term rate
based on daily compounding because that rate is most consistent

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with section 6621 which, pursuant to section 6622, is subject to
daily compounding.
Rounded to the nearest full percent, the federal short-
term rate based on daily compounding determined during the month
of October 2003 is 1 percent. Accordingly, an overpayment rate
of 4 percent (3 percent in the case of a corporation) and an
underpayment rate of 4 percent are established for the calendar
quarter beginning January 1, 2004. The overpayment rate for the
portion of a corporate overpayment exceeding $10,000 for the
calendar quarter beginning January 1, 2004, is 1.5 percent. The
underpayment rate for large corporate underpayments for the
calendar quarter beginning January 1, 2004, is 6 percent. These
rates apply to amounts bearing interest during that calendar
quarter.
The 4 percent rate also applies to estimated tax
underpayments for the first calendar quarter in 2004 and for the
first 15 days in April 2004.
Interest factors for daily compound interest for annual
rates of 1.5 percent, 3 percent, 4 percent, and 6 percent are
published in Tables 56, 59, 61, and 65 of Rev. Proc. 95-17,
1995-1 C.B. 556, 610, 613, 615, and 619.
Annual interest rates to be compounded daily pursuant to
section 6622 that apply for prior periods are set forth in the
tables accompanying this revenue ruling.

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DRAFTING INFORMATION
The principal author of this revenue ruling is Crystal
Foster of the Office of Associate Chief Counsel (Procedure &
Administration). For further information regarding this revenue
ruling, contact Ms. Foster at (202) 622-7326 (not a toll-free
call).

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TABLE OF INTEREST RATES

PERIODS BEFORE JUL. 1, 1975 - PERIODS ENDING DEC. 31, 1986

OVERPAYMENTS AND UNDERPAYMENTS

In 1995-1 C.B.
PERIOD RATE DAILY RATE TABLE

Before Jul. 1, 1975 6% Table 2, pg. 557
Jul. 1, 1975--Jan. 31, 1976 9% Table 4, pg. 559
Feb. 1, 1976--Jan. 31, 1978 7% Table 3, pg. 558
Feb. 1, 1978--Jan. 31, 1980 6% Table 2, pg. 557
Feb. 1, 1980--Jan. 31, 1982 12% Table 5, pg. 560
Feb. 1, 1982--Dec. 31, 1982 20% Table 6, pg. 560
Jan. 1, 1983--Jun. 30, 1983 16% Table 37, pg. 591
Jul. 1, 1983--Dec. 31, 1983 11% Table 27, pg. 581
Jan. 1, 1984--Jun. 30, 1984 11% Table 75, pg. 629
Jul. 1, 1984--Dec. 31, 1984 11% Table 75, pg. 629
Jan. 1, 1985--Jun. 30, 1985 13% Table 31, pg. 585
Jul. 1, 1985--Dec. 31, 1985 11% Table 27, pg. 581
Jan. 1, 1986--Jun. 30, 1986 10% Table 25 pg. 579
Jul. 1, 1986--Dec. 31, 1986 9% Table 23, pg. 577

TABLE OF INTEREST RATES

FROM JAN. 1, 1987 - Dec. 31, 1998

OVERPAYMENTS UNDERPAYMENTS
________

1995-1 C.B. 1995-1 C.B.
RATE TABLE PG RATE TABLE PG
Jan. 1, 1987--Mar. 31, 1987 8% 21 575 9% 23 577
Apr. 1, 1987--Jun. 30, 1987 8% 21 575 9% 23 577
Jul. 1, 1987--Sep. 30, 1987 8% 21 575 9% 23 577
Oct. 1, 1987--Dec. 31, 1987 9% 23 577 10% 25 579
Jan. 1, 1988--Mar. 31, 1988 10% 73 627 11% 75 629
Apr. 1, 1988--Jun. 30, 1988 9% 71 625 10% 73 627
Jul. 1, 1988--Sep. 30, 1988 9% 71 625 10% 73 627
Oct. 1, 1988--Dec. 31, 1988 10% 73 627 11% 75 629
Jan. 1, 1989--Mar. 31, 1989 10% 25 579 11% 27 581
Apr. 1, 1989--Jun. 30, 1989 11% 27 581 12% 29 583
Jul. 1, 1989--Sep. 30, 1989 11% 27 581 12% 29 583
Oct. 1, 1989--Dec. 31, 1989 10% 25 579 11% 27 581
Jan. 1, 1990--Mar. 31, 1990 10% 25 579 11% 27 581
Apr. 1, 1990--Jun. 30, 1990 10% 25 579 11% 27 581
Jul. 1, 1990--Sep. 30, 1990 10% 25 579 11% 27 581
Oct. 1, 1990--Dec. 31, 1990 10% 25 579 11% 27 581
Jan. 1, 1991--Mar. 31, 1991 10% 25 579 11% 27 581
Apr. 1, 1991--Jun. 30, 1991 9% 23 577 10% 25 579
Jul. 1, 1991--Sep. 30, 1991 9% 23 577 10% 25 579

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Oct. 1, 1991--Dec. 31, 1991 9% 23 577 10% 25 579
Jan. 1, 1992--Mar. 31, 1992 8% 69 623 9% 71 625
Apr. 1, 1992--Jun. 30, 1992 7% 67 621 8% 69 623
Jul. 1, 1992--Sep. 30, 1992 7% 67 621 8% 69 623
Oct. 1, 1992--Dec. 31, 1992 6% 65 619 7% 67 621
Jan. 1, 1993--Mar. 31, 1993 6% 17 571 7% 19 573
Apr. 1, 1993--Jun. 30, 1993 6% 17 571 7% 19 573
Jul. 1, 1993--Sep. 30, 1993 6% 17 571 7% 19 573
Oct. 1, 1993--Dec. 31, 1993 6% 17 571 7% 19 573
Jan. 1, 1994--Mar. 31, 1994 6% 17 571 7% 19 573
Apr. 1, 1994--Jun. 30, 1994 6% 17 571 7% 19 573
Jul. 1, 1994--Sep. 30, 1994 7% 19 573 8% 21 575
Oct. 1, 1994--Dec. 31, 1994 8% 21 575 9% 23 577
Jan. 1, 1995--Mar. 31, 1995 8% 21 575 9% 23 577
Apr. 1, 1995--Jun. 30, 1995 9% 23 577 10% 25 579
Jul. 1, 1995--Sep. 30, 1995 8% 21 575 9% 23 577
Oct. 1, 1995--Dec. 31, 1995 8% 21 575 9% 23 577
Jan. 1, 1996--Mar. 31, 1996 8% 69 623 9% 71 625
Apr. 1, 1996--Jun. 30, 1996 7% 67 621 8% 69 623
Jul. 1, 1996--Sep. 30, 1996 8% 69 623 9% 71 625
Oct. 1, 1996--Dec. 31, 1996 8% 69 623 9% 71 625
Jan. 1, 1997--Mar. 31, 1997 8% 21 575 9% 23 577
Apr. 1, 1997--Jun. 30, 1997 8% 21 575 9% 23 577
Jul. 1, 1997--Sep. 30, 1997 8% 21 575 9% 23 577
Oct. 1, 1997--Dec. 31, 1997 8% 21 575 9% 23 577
Jan. 1, 1998--Mar. 31, 1998 8% 21 575 9% 23 577
Apr. 1, 1998--Jun. 30, 1998 7% 19 573 8% 21 575
Jul. 1, 1998--Sep. 30, 1998 7% 19 573 8% 21 575
Oct. 1, 1998--Dec. 31, 1998 7% 19 573 8% 21 575

TABLE OF INTEREST RATES
FROM JANUARY 1, 1999 - PRESENT

NONCORPORATE OVERPAYMENTS AND UNDERPAYMENTS

1995-1 C.B.
RATE TABLE PAGE
Jan. 1, 1999--Mar. 31, 1999 7% 19 573
Apr. 1, 1999--Jun. 30, 1999 8% 21 575
Jul. 1, 1999--Sep. 30, 1999 8% 21 575
Oct. 1, 1999--Dec. 31, 1999 8% 21 575
Jan. 1, 2000--Mar. 31, 2000 8% 69 623
Apr. 1, 2000--Jun. 30, 2000 9% 71 625
Jul. 1, 2000--Sep. 30, 2000 9% 71 625

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Oct. 1, 2000--Dec 31, 2000 9% 71 625
Jan. 1, 2001--Mar. 31, 2001 9% 23 577
Apr. 1, 2001--Jun. 30, 2001 8% 21 575
Jul. 1, 2001--Sep. 30, 2001 7% 19 573
Oct. 1, 2001--Dec. 31, 2001 7% 19 573
Jan. 1, 2002--Mar. 31, 2002 6% 17 571
Apr. 1, 2002--Jun. 30, 2002 6% 17 571
Jul. 1, 2002--Sep. 30, 2002 6% 17 571
Oct. 1, 2002--Dec. 31, 2002 6% 17 571
Jan. 1, 2003--Mar. 31, 2003 5% 15 569
Apr. 1, 2003--Jun. 30, 2003 5% 15 569
Jul. 1, 2003--Sep. 30, 2003 5% 15 569
Oct. 1, 2003--Dec. 31, 2003 4% 13 567
Jan. 1, 2004-—Mar. 31, 2004 4% 61 615

TABLE OF INTEREST RATES

FROM JANUARY 1, 1999 - PRESENT

CORPORATE OVERPAYMENTS AND UNDERPAYMENTS

OVERPAYMENTS UNDERPAYMENTS
_____________________________

1995-1 C.B. 1995-1 C.B.

RATE TABLE PG RATE TABLE PG

Jan. 1, 1999--Mar. 31, 1999 6% 17 571 7% 19 573
Apr. 1, 1999--Jun. 30, 1999 7% 19 573 8% 21 575
Jul. 1, 1999--Sep. 30, 1999 7% 19 573 8% 21 575
Oct. 1, 1999--Dec. 31, 1999 7% 19 573 8% 21 575
Jan. 1, 2000--Mar. 31, 2000 7% 67 621 8% 69 623
Apr. 1, 2000--Jun. 30, 2000 8% 69 623 9% 71 625

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Jul. 1, 2000--Sep. 30, 2000 8% 69 623 9% 71 625
Oct. 1, 2000--Dec. 31, 2000 8% 69 623 9% 71 625
Jan. 1, 2001--Mar. 31, 2001 8% 21 575 9% 23 577
Apr. 1, 2001--Jun. 30, 2001 7% 19 573 8% 21 575
Jul. 1, 2001--Sep. 30, 2001 6% 17 571 7% 19 573
Oct. 1, 2001--Dec. 31, 2001 6% 17 571 7% 19 573
Jan. 1, 2002--Mar. 31, 2002 5% 15 569 6% 17 571
Apr. 1, 2002--Jun. 30, 2002 5% 15 569 6% 17 571
Jul. 1, 2002--Sep. 30, 2002 5% 15 569 6% 17 571
Oct. 1, 2002--Dec. 31, 2002 5% 15 569 6% 17 571
Jan. 1, 2003--Mar. 31, 2003 4% 13 567 5% 15 569
Apr. 1, 2003--Jun. 30, 2003 4% 13 567 5% 15 569
Jul. 1, 2003--Sep. 30, 2003 4% 13 567 5% 15 569
Oct. 1, 2003--Dec. 31, 2003 3% 11 565 4% 13 567
Jan. 1, 2004-—Mar. 31, 2004 3% 59 613 4% 61 615

TABLE OF INTEREST RATES FOR
LARGE CORPORATE UNDERPAYMENTS

FROM JANUARY 1, 1991 - PRESENT

1995-1 C.B.
RATE TABLE PG

Jan. 1, 1991--Mar. 31, 1991 13% 31 585
Apr. 1, 1991--Jun. 30, 1991 12% 29 583
Jul. 1, 1991--Sep. 30, 1991 12% 29 583
Oct. 1, 1991--Dec. 31, 1991 12% 29 583
Jan. 1, 1992--Mar. 31, 1992 11% 75 629
Apr. 1, 1992--Jun. 30, 1992 10% 73 627
Jul. 1, 1992--Sep. 30, 1992 10% 73 627
Oct. 1, 1992--Dec. 31, 1992 9% 71 625
Jan. 1, 1993--Mar. 31, 1993 9% 23 577
Apr. 1, 1993--Jun. 30, 1993 9% 23 577
Jul. 1, 1993--Sep. 30, 1993 9% 23 577
Oct. 1, 1993--Dec. 31, 1993 9% 23 577
Jan. 1, 1994--Mar. 31, 1994 9% 23 577
Apr. 1, 1994--Jun. 30, 1994 9% 23 577
Jul. 1, 1994--Sep. 30, 1994 10% 25 579
Oct. 1, 1994--Dec. 31, 1994 11% 27 581
Jan. 1, 1995--Mar. 31, 1995 11% 27 581

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Apr. 1, 1995--Jun. 30, 1995 12% 29 583
Jul. 1, 1995--Sep. 30, 1995 11% 27 581
Oct. 1, 1995--Dec. 31, 1995 11% 27 581
Jan. 1, 1996--Mar. 31, 1996 11% 75 629
Apr. 1, 1996--Jun. 30, 1996 10% 73 627
Jul. 1, 1996--Sep. 30, 1996 11% 75 629
Oct. 1, 1996--Dec. 31, 1996 11% 75 629
Jan. 1, 1997--Mar. 31, 1997 11% 27 581
Apr. 1, 1997--Jun. 30, 1997 11% 27 581
Jul. 1, 1997--Sep. 30, 1997 11% 27 581
Oct. 1, 1997--Dec. 31, 1997 11% 27 581
Jan. 1, 1998--Mar. 31, 1998 11% 27 581
Apr. 1, 1998--Jun. 30, 1998 10% 25 579
Jul. 1, 1998--Sep. 30, 1998 10% 25 579
Oct. 1, 1998--Dec. 31, 1998 10% 25 579
Jan. 1, 1999--Mar. 31, 1999 9% 23 577
Apr. 1, 1999--Jun. 30, 1999 10% 25 579
Jul. 1, 1999--Sep. 30, 1999 10% 25 579
Oct. 1, 1999--Dec. 31, 1999 10% 25 579
Jan. 1, 2000--Mar. 31, 2000 10% 73 627
Apr. 1, 2000--Jun. 30, 2000 11% 75 629
Jul. 1, 2000--Sep. 30, 2000 11% 75 629
Oct. 1, 2000--Dec. 31, 2000 11% 75 629
Jan. 1, 2001--Mar. 31, 2001 11% 27 581
Apr. 1, 2001--Jun. 30, 2001 10% 25 579
Jul. 1, 2001--Sep. 30, 2001 9% 23 577
Oct. 1, 2001--Dec. 31, 2001 9% 23 577
Jan. 1, 2002--Mar. 31, 2002 8% 21 575
Apr. 1, 2002--Jun. 30, 2002 8% 21 575
Jul. 1, 2002--Sep. 30, 2002 8% 21 575
Oct. 1, 2002--Dec. 30, 2002 8% 21 575
Jan. 1, 2003--Mar. 31, 2003 7% 19 573
Apr. 1, 2003--Jun. 30, 2003 7% 19 573
Jul. 1, 2003--Sep. 30, 2003 7% 19 573
Oct. 1, 2003--Dec. 31, 2003 6% 17 571
Jan. 1, 2004-—Mar. 31, 2004 6% 65 619

TABLE OF INTEREST RATES FOR CORPORATE
OVERPAYMENTS EXCEEDING $10,000

FROM JANUARY 1, 1995 – PRESENT

1995-1 C.B.
RATE TABLE PG

Jan. 1, 1995--Mar. 31, 1995 6.5% 18 572
Apr. 1, 1995--Jun. 30, 1995 7.5% 20 574
Jul. 1, 1995--Sep. 30, 1995 6.5% 18 572
Oct. 1, 1995--Dec. 31, 1995 6.5% 18 572
Jan. 1, 1996--Mar. 31, 1996 6.5% 66 620
Apr. 1, 1996--Jun. 30, 1996 5.5% 64 618

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Jul. 1, 1996--Sep. 30, 1996 6.5% 66 620
Oct. 1, 1996--Dec. 31, 1996 6.5% 66 620
Jan. 1, 1997--Mar. 31, 1997 6.5% 18 572
Apr. 1, 1997--Jun. 30, 1997 6.5% 18 572
Jul. 1, 1997--Sep. 30, 1997 6.5% 18 572
Oct. 1, 1997--Dec. 31, 1997 6.5% 18 572
Jan. 1, 1998--Mar. 31, 1998 6.5% 18 572
Apr. 1, 1998--Jun. 30, 1998 5.5% 16 570
Jul. 1. 1998--Sep. 30, 1998 5.5% 16 570
Oct. 1, 1998--Dec. 31, 1998 5.5% 16 570
Jan. 1, 1999--Mar. 31, 1999 4.5% 14 568
Apr. 1, 1999--Jun. 30, 1999 5.5% 16 570
Jul. 1, 1999--Sep. 30, 1999 5.5% 16 570
Oct. 1, 1999--Dec. 31, 1999 5.5% 16 570
Jan. 1, 2000--Mar. 31, 2000 5.5% 64 618
Apr. 1, 2000--Jun. 30, 2000 6.5% 66 620
Jul. 1, 2000--Sep. 30, 2000 6.5% 66 620
Oct. 1, 2000--Dec. 31, 2000 6.5% 66 620
Jan. 1, 2001--Mar. 31, 2001 6.5% 18 572
Apr. 1, 2001--Jun. 30, 2001 5.5% 16 570
Jul. 1, 2001--Sep. 30, 2001 4.5% 14 568
Oct. 1, 2001--Dec. 31, 2001 4.5% 14 568
Jan. 1, 2002--Mar. 31, 2002 3.5% 12 566
Apr. 1, 2002--Jun. 30, 2002 3.5% 12 566
Jul. 1, 2002--Sep. 30, 2002 3.5% 12 566
Oct. 1, 2002--Dec. 31, 2002 3.5% 12 566
Jan. 1, 2003--Mar. 31, 2003 2.5% 10 564
Apr. 1, 2003--Jun. 30, 2003 2.5% 10 564
Jul. 1, 2003--Sep. 30, 2003 2.5% 10 564
Oct. 1, 2003--Dec. 31, 2003 1.5% 8562
Jan. 1, 2004-—Mar. 31, 2004
1.5% 56 610