IRS Penalty Calculator: what is your bill really costing you?
Calculate your IRS penalties and interest as one number. Then see what another month of waiting adds, and which relief may apply.
Could this come off?
First-time penalty abatement check
Important: This calculator provides a simplified estimate of IRS penalties and interest and does not reproduce an official IRS account calculation. Your actual balance may differ based on partial payments, interest charged on penalties and IRS processing dates. This estimate does not include the estimated tax penalty, accuracy-related penalties or other additions to tax. It is not tax or legal advice. For advice on your situation, speak with The W Tax Group.
The cost of waiting
What this bill grows to if nothing changes
Projected month by month from today, using your details. The filing penalty stops at its cap; the payment penalty and interest keep going.
What’s in the number
Three charges. Three different clocks.
Failure to file
Starts the day after your filing deadline, including any extension. Stops at 25%. Over 60 days late, a minimum applies: $525 or the tax owed, whichever is less, for returns due in 2026. In months when both penalties run, it is reduced by the payment penalty, so 4.5% in most cases.
Late filing calculator →Failure to pay
Starts at the original due date. An extension to file does not stop it. Capped at 25%. It drops to 0.25% a month during an installment agreement on a return filed on time, and rises to 1% a month once the tax is unpaid 10 days after a notice of intent to levy.
Late payment calculator →Interest
Rate for Q4 2026 (Oct 1–Dec 31, 2026). The federal short-term rate plus 3 points, reset every quarter and compounded daily. No cap. It runs from the original due date until the balance is paid in full, and the IRS also charges it on most penalties.
Every quarterly rate ↓IRS interest rates
Underpayment rate by quarter
The calculator applies the right rate to each day your balance was open. On a payment plan, interest keeps running at these rates. See how interest works on IRS payment plans.
| Year | Jan–Mar | Apr–Jun | Jul–Sep | Oct–Dec |
|---|
Individual underpayment rate, IRC section 6621. Source: IRS quarterly interest rates; Q4 2026 rate per Revenue Ruling 2026-15.
Lower the number
Four ways to cut what you owe
Not sure which penalties are on your account? Start with our guide to IRS tax penalties.
First-time abatement
A clean three-year history can remove the filing and payment penalties.
Check eligibility →Reasonable cause
Illness, disaster or events outside your control can justify relief with documentation.
Penalty abatement →Payment plan
Generally pauses levies and halves the payment penalty on a return filed on time.
Payment plan calculator →File now, even unpaid
The filing penalty is ten times the payment penalty. Filing stops the bigger clock.
Unfiled returns help →Questions
IRS penalties and interest, answered
How does the IRS calculate penalties?
On a late Form 1040, two penalties apply to the unpaid tax. The failure-to-file penalty is 5% for each month or part of a month the return is late, up to 25%, reduced by the payment penalty in months both run. The failure-to-pay penalty is 0.5% a month from the original due date, up to 25%. It drops to 0.25% under a payment plan on a return filed on time and rises to 1% once the tax is unpaid 10 days after a notice of intent to levy. An extension stops only the filing penalty, not the payment penalty or interest.
What is the maximum IRS penalty?
For late filing and late payment together, generally 47.5% of the unpaid tax: 22.5% for filing (five months at 4.5%) plus 25% for paying. On small balances, a return more than 60 days late carries a minimum penalty of $525 or 100% of the tax, whichever is less, for returns due in 2026. A fraudulent failure to file can reach 75%. Interest has no cap.
Does the IRS charge penalties and interest?
Yes, and they stack. Penalties are charged on the unpaid tax, and interest runs on that tax from the original due date until it is paid in full. The IRS also charges interest on most penalties. This calculator shows interest on the tax only, so an IRS notice can run higher.
How much interest does the IRS charge?
7% a year for individuals from October 1 to December 31, 2026, compounded daily. The rate is the federal short-term rate plus 3 percentage points and is reset every quarter. In 2026 it was 7% in every quarter except April to June, when it was 6%.
Can IRS penalties be removed?
Yes, in many cases. First-time abatement can remove the failure-to-file and failure-to-pay penalties if you had no penalties in the prior three years, have filed all required returns and have paid or arranged to pay. Reasonable-cause relief covers events outside your control, such as serious illness or a disaster, with documentation. Interest on the tax generally stays, but interest charged on a removed penalty comes off with it.
This IRS penalty and interest calculator applies Internal Revenue Code section 6651: the overlap rule, the 25% caps, the 60-day minimum, the 0.25% payment-plan rate and the 1% rate after a notice of intent to levy. Interest follows sections 6601, 6621 and 6622 at IRS quarterly rates, compounded daily. Estimates apply to individual federal IRS balances on Form 1040. They exclude interest on penalties, the estimated tax penalty and accuracy-related penalties. Updated October 2026. Not tax advice; no attorney-client relationship is created.
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