NEWS & INSIGHTS
Florida’s Floating Interest Rate for Taxes: January – June 2025
Florida taxpayers should be aware of a new floating interest rate that will affect deficiencies (underpayments), late payments, and overpayments of most taxes and fees. The Florida Department of Revenue has set the interest rate at 12% for the period from January 1, 2025, to June 30, 2025. Here’s what this means for you:
What is the Floating Interest Rate?
Florida law requires a floating interest rate on various tax payments based on the adjusted prime interest rate charged by banks. This rate can change semi-annually, providing a variable cost structure for late or deficient payments as well as interest on overpaid taxes.
For this upcoming period, the daily interest rate factor is set at 0.000328767. The floating rate’s cap is 12%, ensuring predictability for taxpayers.
Impact on Deficiencies and Late Payments
If you owe taxes and pay them late, the interest accrued is calculated using the daily interest rate factor. For example:
Scenario 1: A taxpayer owes $2,000 in Florida sales tax for February 2025, with a due date of March 20, 2025. The payment is made on May 15, 2025—56 days late. Interest calculation:
$2,000 × 56 × 0.000328767 = $36.82
Scenario 2: A $5,000 payment due in October 2023 is settled in February 2024, spanning two rate periods. The calculation incorporates the rates for both periods:
$5,000 × 72 days × 0.000301370 = $108.49
$5,000 × 43 days × 0.000327869 = $70.49
Total Interest Due: $178.98
Interest on Overpayments
For taxpayers entitled to a refund due to overpayment, the interest rate is 11% for this same period, with a daily factor of 0.000301370. This applies primarily after 90 days from the submission of a completed refund application. Exceptions include reemployment tax overpayments, which do not accrue interest.
Taxes and Fees Affected
The floating interest rate applies to a wide range of taxes and fees, including:
Sales and use taxes
Corporate income tax
Insurance premium tax
Motor fuel taxes
Estate tax
Communications services tax
Practical Tips for Taxpayers
Timely Payments: Avoid accruing interest by ensuring your tax returns and payments are filed on time.
Accurate Calculations: Use the daily interest rate factor relevant to your tax period when calculating interest.
Refund Awareness: If eligible for a refund, file applications promptly to minimize waiting periods for interest accrual.
Proactive planning and understanding the floating interest rate structure can save you money and reduce the hassle of tax compliance.
Additional Articles by the SALTy Orange at Moffa Tax Law:
Notice of Proposed Assessment – NOPA
Notice of Intent to Make Audit Changes DR-1215
DR-840 Notice of Intent to Audit Books and Records – 2025
What to Expect from a Florida Tax Audit
Motor Vehicle Sales Tax Rates by State – 2024
Jeanette Moffa, Esq.
Phone: (954) 800-4138
Email: [email protected]
Jeanette Moffa is a Partner in the Fort Lauderdale office of Moffa, Sutton, & Donnini. She focuses her practice in Florida state and local tax. Jeanette provides SALT planning and consulting as part of her practice, addressing issues such as nexus and taxability, including exemptions, inclusions, and exclusions of transactions from the tax base. In addition, she handles tax controversy, working with state and local agencies in resolution of assessment and refund cases. She also litigates state and local tax and administrative law issues.
