IRS Interest Rates Unchanged for the First Quarter of 2012

The interest rate that individuals will pay on underpayments remains at 3% for the first quarter of 2012. The interest rate that the IRS will pay on overpayments (tax refunds) will also be 3%. Most ordinary tax refunds do not earn interest. The IRS does not have to pay interest on tax refunds made within 45 days of the return

Tags: IRS interest rate, overpayments, underpayments

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Tax Glossary

Deductions

Items directly reducing income. Personal deductions such as for mortgage interest, state and local taxes, and charitable contributions are allowed only if deductions are itemized on Schedule A, but deductions such as for alimony, capital losses, moving expenses to a new job location, business losses, student loan interest, and IRA and Keogh deductions are deducted from gross income even if itemized deductions are not claimed.

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