Have an IRS underpayment lurking in your books? The potential sting just got a little easier. IRS is dropping its interest rates by 1% for the third quarter of ’08.

Of course, that means if you make an overpayment, you’ll be getting less back from the feds too. Starting July 1, the new interest rates are:
• 5% for underpayments
• 7% for large corporate underpayments
• 4% for corporate overpayments, and
• 2.5% for the portion of a corporate overpayment that’s more than $10,000.

Tags: Interest rates, IRS, Tax compliance