Pennsylvania Interest on Underpayments of Tax

(Current through December 2014)

Under sections 806 and 806.1 of the Fiscal Code (72 P.S. §§ 806 and 806.1), all underpayments of tax which became due and payable to the Commonwealth of Pennsylvania on or after January 1, 1982, bear interest at the same rate established under section 6621(a)(2) of the Internal Revenue Code. However, the Pennsylvania interest is simple interest (and not compounded like federal interest) and the Pennsylvania rates are adjusted annually, and not quarterly.

These same rates apply to overpayments of tax under Article III of the Tax Reform Code of 1971, but all other overpayments of tax bear interest at a rate that is two percentage points lower.

The following is a table of the rates that have applied since January 1, 1982, expressed both as an annual rate and as a daily factor. To calculate interest for X days, multiply the daily factor by X and the tax underpaid. (See also, 61 Pa.Code 4.2(b).)

Year	Underpayment Annual Rate	Underpayment Daily Factor	Authority
1982	20%	.000548
1983	16%	.000438
1984	11%	.000301
1985	13%	.000356
1986	10%	.000274
1987	9%	.000247	16 Pa.B. 4908
1988	11%	.000301	17 Pa.B. 5286
1989	11%	.000301	18 Pa.B. 5680
1990	11%	.000301	19 Pa.B. 5081
1991	11%	.000301	20 Pa.B. 5870
1992	9%	.000247	21 Pa.B. 6012
1993	7%	.000192	22 Pa.B. 6142
1994	7%	.000192	24 Pa.B. 81
1995	9%	.000247	24 Pa.B. 6486
1996	9%	.000247	25 Pa.B. 5788
1997	9%	.000247	26 Pa.B. 6224
1998	9%	.000247	27 Pa.B. 6866
1999	7%	.000192	28 Pa.B. 6351
2000	8%	.000218	29 Pa.B. 6377
2001	9%	.000247	30 Pa.B. 6494
2002	6%	.000164	31 Pa.B. 6990
2003	5%	.000137	32 Pa.B. 6220
2004	4%	.000110	34 Pa.B. 448
2005	5%	.000137	35 Pa.B. 78
2006	7%	.000192	35 Pa.B. 7067
2007	8%	.000218	36 Pa.B. 8021
2008	7%	.000192	37 Pa.B. 6097
2009	5%	.000137	39 Pa.B. 103
2010	4%	.000110	39 Pa.B. 7256
2011	3%	.000082	40 Pa.B. 7443
2012	3%	.000082	41 Pa.B. 7041
2013	3%	.000082	42 Pa.B. 7775
2014	3%	.000082	43 Pa.B. 7602

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Daniel B. Evans, Attorney at Law
P.O. Box 27370
Philadelphia, PA 19118
Telephone: (866) 348-4250
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