An estimated tax penalty calculator and IRS interest calculator
This estimated tax penalty calculator works out the IRS underpayment penalty the way Form 2210’s regular method does: it splits your required annual payment into four installments, checks what your withholding and estimated payments covered by each due date, and charges the IRS quarterly interest rate on every shortfall until it is paid or until April 15 of the following year.
Switch to the IRS interest calculator to see what a late payment costs: interest on unpaid tax from the due date to the day you pay, compounded daily at each quarter’s rate, with the optional failure-to-pay penalty. Every IRS rate from 2023 to the fourth quarter of 2026 is built in with the bulletin that announced it.
It runs in your browser and nothing is sent anywhere. Treat the result as an estimate, not tax advice — the IRS computes the penalty and interest it actually bills.
How to use the Estimated Tax Penalty & IRS Interest Calculator
- Choose Underpayment penalty or Interest on unpaid tax.
- For the penalty, pick the tax year and enter this year’s total tax, tax withheld and last year’s total tax; tick the 110% box if last year’s AGI was over $150,000.
- Enter each estimated payment with the date it reached the IRS. Payment dates move automatically when you change the year.
- For interest, enter the unpaid tax, the due date and the date you will pay, and tick the failure-to-pay penalty if you want it included.
- Read the total and the installment or quarter table, then copy the result.
Estimated Tax Penalty & IRS Interest Calculator features
Form 2210 regular method
Four installments, withholding spread evenly, later payments applied to the earliest shortfall, penalty to the payment date or April 15.
Safe harbour test
Lesser of 90% of this year’s tax or 100% of last year’s (110% above $150,000 AGI), plus the $1,000 and zero-liability exemptions.
Real quarterly IRS rates
Every underpayment rate from 2023 to Q4 2026, including the 6% second quarter of 2026, with a 366-day divisor in 2024.
Interest compounded daily
Interest on unpaid tax follows the IRS method, with a table of days at each rate.
Failure-to-pay penalty
0.5% a month or part month, 0.25% on a payment plan, capped at 25%.
How the Form 2210 penalty is worked out
The required annual payment is the smaller of 90% of this year’s tax and 100% of last year’s (110% if last year’s adjusted gross income was over $150,000). A quarter of it is due on April 15, June 15, September 15 and January 15. Withholding counts as paid in equal parts on those dates. If an installment is short, the penalty is the shortfall × days late × the IRS rate ÷ 365 (366 in a leap year).
Worked example (2025): tax $20,000, withholding $8,000, last year’s tax $16,000. The required annual payment is $16,000, so $4,000 per installment. Withholding covers $2,000 of each and $1,000 estimated payments another $1,000, leaving $1,000 short each time. At 7% (6% from April 1, 2026) until April 15, 2026, the penalty is about $184.58.
IRS underpayment interest rates
| Quarter | 2024 | 2025 | 2026 |
|---|---|---|---|
| Jan–Mar | 8% | 7% | 7% |
| Apr–Jun | 8% | 7% | 6% |
| Jul–Sep | 8% | 7% | 7% |
| Oct–Dec | 8% | 7% | 7% |
Avoiding the penalty next year
Paying 100% of last year’s tax (110% for higher earners) through withholding and four equal estimated payments guarantees no penalty, whatever this year’s tax turns out to be. Raising withholding late in the year also works, because withholding is treated as spread evenly. If your income arrived late in the year, the annualized income method on Schedule AI can lower the penalty — this calculator does not do that.
Self-employed? The self-employment tax calculator works out quarterly estimated payments, and the paycheck calculator shows what extra withholding does to your take-home pay.
Estimated Tax Penalty & IRS Interest Calculator FAQ
How is the estimated tax penalty calculated?
Each quarterly installment that was short accrues the IRS underpayment rate (the federal short-term rate plus 3%) from its due date until it is paid or until April 15. This estimated tax penalty calculator follows that Form 2210 regular method.
What is the IRS interest rate on unpaid tax for 2026?
7% for January–March, 6% for April–June and 7% for July–September and October–December 2026, compounded daily.
How do I avoid the underpayment penalty?
Pay at least the smaller of 90% of this year’s tax or 100% of last year’s (110% if AGI was over $150,000) on time, or owe less than $1,000 after withholding.
Does an extension stop IRS interest?
No. An extension gives more time to file, not to pay. Interest runs from the original due date.
How does this IRS interest calculator handle late payment penalties?
Tick the failure-to-pay box to add 0.5% a month or part month (0.25% on a payment plan), capped at 25%. Interest on the penalty is not included.
Will my IRS bill match exactly?
Not necessarily. The IRS may use actual withholding dates, waivers or the annualized method. Use this as an estimate.