Interest Rates

Title 32 V.S.A. § 3108 (Establishment of interest rates) as most recently amended by Act 143 (2012) requires the Commissioner to set rates no later than December 15 for the calculation of interest on underpayment and overpayment of tax liabilities for the upcoming calendar year. The annual rate for overpayments is rounded up to the nearest quarter percent, with the monthly rate rounded to the nearest whole tenth of a percent. The annual rate· for underpayments is set at 200 basis points above the rate for overpayments.

2017 Interest Rate Memo

The average prime loan rate charged by banks (as determined by the Board of Governors of the Federal Reserve System) for the 12-month period beginning October 1, 2015 and ending September 30, 2016 was 3.45%. Rounded up to the nearest quarter percent, the annual rate for 2015 is 3.5%. When converted to a monthly rate, the result is 0.29% per month.

Under 32 V.S.A. § 3108(a), the monthly rate is rounded up to the nearest whole tenth of a percent, producing an interest rate applicable to 2016 of 0.3% per month for overpayments, and an annual rate of 3.6%. The 2016 annual interest rate for underpayments is 5.6%, or 0.5% per month. These rates are effective beginning January 1, 2017 and apply to interest that accrues in calendar year 2017.

 

Current Interest Rate Chart

Year Overpayment Annual Rate Underpayment Annual Rate
2017 3.6% 5.6%

Interest Rate Chart (1981-2015)

Year Annual Rate Overpayment Annual Rate Underpayment Annual Rate
2016   3.6% 5.6%
2015   3.6% 5.6%
2014   3.6% 5.6%
2013   3.6% 5.6%
2012 4.8%    
2011 4.8%    
2010 4.8%    
2009 6.0%    
2008 9.6%    
2007 8.4%    
2006 6.0%    
2005 6.0%    
2004 6.0%    
2003 6.0%    
2002 8.4%    
2001 9.6%    
2000 8.4%    
1999 9.6%    
1998 9.6%    
1997 9.6%    
1996 9.6%    
1995 7.2%    
1994 6.0%    
1993 7.2%    
1992 9.6%    
1991 12.0%    
1990 12.0%    
1989 10.8%    
1988 9.6%    
1987 9.6%    
1986 12.0%    
1985 13.2%    
1984 12.0%    
1983 15.6%    
1982 12.0%    
Prior Years* 12.0%    

*Interest rate for 1981 and prior set by statute

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Commissioner Kaj Samsom
133 State Street | Montpelier, VT 05633
(802) 828-2505

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