The interest rates on overpayments and underpayments are unchanged from the first quarter of 2021 (Rev Rul. 2021-6). The rates are:
The 3% rate is used to figure estimated tax penalties for individuals for the first 15 days of April.
Items, such as interest, state and local income and sales taxes, charitable contributions, and medical deductions, claimed on Schedule A of Form 1040. Itemized deductions are subtracted from adjusted gross income to arrive at taxable income. The amount of itemized deductions is also subject to a reduction when adjusted gross income exceeds certain limits.