{
  "id": "irs-late-payment-penalty",
  "version": "2faa31a37ede",
  "status": "published",
  "name": "IRS Late Payment Penalty Calculator",
  "question": "What is my IRS late payment penalty?",
  "summary": "Works out the IRS failure-to-pay penalty (0.5% a month, up to 25%) and the interest on unpaid tax at the IRS quarterly rates, compounded daily, from the due date to the day you pay.",
  "category": "finance",
  "subcategory": "tax-and-pay",
  "url": "https://www.acalculator.org/finance/irs-late-payment-penalty-calculator",
  "markdown": "https://www.acalculator.org/finance/irs-late-payment-penalty-calculator.md",
  "kind": "function",
  "method": "Penalty = unpaid tax × 0.5% (0.25% with an installment agreement) × months or parts of a month late, at most 25% of the tax. Interest = tax × (Π over each day from the due date to the day before payment of (1 + rate ÷ days in the year)) − tax, with the IRS underpayment rate for that day’s quarter.",
  "assumptions": [
    "An estimate, not tax advice. The IRS figures the exact amounts on its notice.",
    "The return was filed on time: the failure-to-file penalty (5% a month) is not included, and neither is the higher 1% rate after an IRS notice of intent to levy.",
    "The tax is paid in one amount on the payment date; no partial payments, credits, or first-time penalty relief.",
    "Interest is on the unpaid tax only. The IRS also charges interest on the penalty from its notice date, which is not included.",
    "A month runs from the due date to the same day of the next month (the last day of a shorter month); from a due date on a month’s last day, to the last day of the next month (IRM 20.1.2.3.8.4.2).",
    "Interest rates cover January 1, 2018 to December 31, 2026 (IRS quarterly rates)."
  ],
  "inputs": {
    "$schema": "https://json-schema.org/draft/2020-12/schema",
    "type": "object",
    "properties": {
      "tax": {
        "title": "Unpaid tax",
        "description": "The tax shown on your return that was not paid by the due date.",
        "type": "number",
        "x-unit": "USD",
        "exclusiveMinimum": 0,
        "maximum": 1000000000
      },
      "due": {
        "title": "Payment due date",
        "description": "The date the tax was due, usually April 15 (the next business day when it falls on a weekend or holiday).",
        "type": "string",
        "format": "date"
      },
      "paid": {
        "title": "Date you pay",
        "description": "The date you pay the tax in full.",
        "type": "string",
        "format": "date"
      },
      "plan": {
        "title": "I have an installment agreement",
        "description": "Whether an IRS installment agreement cuts the penalty to 0.25% a month (return filed on time).",
        "type": "boolean"
      }
    }
  },
  "outputs": {
    "total": {
      "label": "Penalty and interest",
      "description": "The failure-to-pay penalty plus the interest on the unpaid tax.",
      "format": "money"
    },
    "penalty": {
      "label": "Failure-to-pay penalty",
      "description": "0.5% (0.25% with an installment agreement) of the unpaid tax for each month or part of a month, at most 25%.",
      "format": "money"
    },
    "interest": {
      "label": "Interest",
      "description": "Interest on the unpaid tax at the IRS underpayment rate, compounded daily.",
      "format": "money"
    },
    "unpaid": {
      "label": "Unpaid tax",
      "description": "The unpaid tax, as typed.",
      "format": "money"
    },
    "amountDue": {
      "label": "Total to pay",
      "description": "The unpaid tax plus the penalty and the interest.",
      "format": "money"
    },
    "months": {
      "label": "Months late",
      "description": "Months or parts of a month from the due date to the payment date.",
      "format": "integer"
    },
    "days": {
      "label": "Days late",
      "description": "Days from the due date to the payment date.",
      "format": "integer"
    },
    "penaltyRate": {
      "label": "Penalty as a share of the tax",
      "description": "The penalty as a percent of the unpaid tax (25% at most).",
      "format": "percent"
    }
  },
  "defaultAnswer": {
    "inputs": {
      "tax": 5000,
      "due": "2026-04-15",
      "paid": "2026-09-30",
      "plan": false
    },
    "outputs": {
      "total": 302.8233511131002,
      "penalty": 150,
      "interest": 152.82335111310022,
      "unpaid": 5000,
      "amountDue": 5302.8233511131,
      "months": 6,
      "days": 168,
      "penaltyRate": 3
    },
    "text": "Paying $5,000.00 of tax on September 30, 2026 instead of April 15, 2026 costs $150.00 in penalty and $152.82 in interest."
  },
  "examples": [
    {
      "given": {
        "tax": 10000,
        "due": "2025-04-15",
        "paid": "2025-10-15",
        "plan": false
      },
      "expect": {
        "months": 6,
        "penalty": 300,
        "interest": 357.1553444525507,
        "total": 657.1553444525507
      },
      "source": "IRC 6651(a)(2): 6 × 0.5% × 10,000; interest at 7% (IRS quarterly rates, 2025) compounded daily over 183 days; Python 3 check in docs/progress/WP-82/penalty.py"
    },
    {
      "given": {
        "tax": 5000,
        "due": "2024-04-15",
        "paid": "2026-09-29",
        "plan": false
      },
      "expect": {
        "months": 30,
        "penalty": 750,
        "interest": 965.2386327544191
      },
      "source": "30 months or parts at 0.5%; interest at 8% (2024, 366-day year), 7% (2025), then 7%, 6%, 7% (2026); Python 3 check in docs/progress/WP-82/penalty.py"
    },
    {
      "given": {
        "tax": 2000,
        "due": "2020-07-15",
        "paid": "2025-07-15",
        "plan": false
      },
      "expect": {
        "months": 60,
        "penalty": 500,
        "penaltyRate": 25,
        "interest": 643.4132727447482
      },
      "source": "IRC 6651(a)(2): the penalty stops at 25% (60 months would be 30%); Python 3 check in docs/progress/WP-82/penalty.py"
    },
    {
      "given": {
        "tax": 8000,
        "due": "2025-04-15",
        "paid": "2026-04-16",
        "plan": true
      },
      "expect": {
        "months": 13,
        "penalty": 260,
        "interest": 578.1279917152751
      },
      "source": "IRC 6651(h): 0.25% a month under an installment agreement; 13 months (one day into the 13th); Python 3 check in docs/progress/WP-82/penalty.py"
    }
  ],
  "sources": [
    "IRS, Quarterly interest rates (underpayment rate for individuals, each quarter from 2018 to the fourth quarter of 2026). https://www.irs.gov/payments/quarterly-interest-rates",
    "IRS, Failure to Pay Penalty. https://www.irs.gov/payments/failure-to-pay-penalty",
    "26 U.S.C. 6651 (failure to file or pay; (a)(2) 0.5% a month up to 25%; (h) 0.25% under an installment agreement). https://www.law.cornell.edu/uscode/text/26/6651",
    "26 U.S.C. 6621 (rate: federal short-term rate plus 3 points) and 6622 (daily compounding). https://www.law.cornell.edu/uscode/text/26/6622"
  ],
  "related": [
    "estimated-tax",
    "tax-refund",
    "income-tax"
  ],
  "changelog": []
}