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IRS Underpayment Interest Calculator2026 Quarterly Rates, Daily Compounding

What does this come to under the current IRS rules?

Interest on unpaid tax at 7%, 6%, 7% and 7% for the four 2026 quarters, compounded daily.

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Your figures
Example figuresIllustrative only. Type over them with your own.
Interest owed
$427
Compounded daily at the 2026 underpayment rates
Balance with interest
$10,427
Days counted
229.0 days
Drawn to one scale
Interest owed$427
Balance with interest$10,427
All results
MeasureResult
Interest owed$427
Balance with interest$10,427
Days counted229.0 days
Rates used7% Q1, 6% Q2, 7% Q3, 7% Q4 2026
How this was worked out
Work shownrecomputed as you type
Balance x (1 + rate / 365)^days, quarter by quarter
2026 individual underpayment rates: 7% Q1, 6% Q2, 7% Q3, 7% Q4
Rate = federal short-term rate + 3 points, set each quarter

Illustrative arithmetic on the figures you enter. Check the result against your firm's methodology before relying on it.

The formulas

  • Balance x (1 + rate / 365)^days, quarter by quarter
  • 2026 individual underpayment rates: 7% Q1, 6% Q2, 7% Q3, 7% Q4
  • Rate = federal short-term rate + 3 points, set each quarter

How it works

The IRS charges interest on unpaid tax from the due date until payment, compounded daily, at the federal short-term rate plus 3 percentage points. The rate resets each quarter, and a change does not affect interest for earlier quarters. Large corporate underpayments above $100,000 carry the short-term rate plus 5 points: 9%, 8%, 9% and 9% for the four quarters of 2026.

IR-2025-112 announced 7% for the first quarter of 2026 and IR-2026-98 announced 7% for the fourth quarter; the quarterly rate page lists 6% for the second and 7% for the third. Interest also runs on penalties. Enter only the days the balance stayed unpaid in each quarter.

Illustrative figures only. Check the result against your firm's methodology before relying on it.

Common questions

Is IRS interest simple or compound?

Compounded daily, unlike the Form 2210 penalty, which uses simple interest.

Can interest be waived?

Reasonable cause does not remove interest. Interest on a penalty falls away when that penalty is abated.

What rate applies to large corporate underpayments?

Short-term rate plus 5 points on C corporation underpayments over $100,000: 9%, 8%, 9% and 9% for 2026.

Sources

Runs in your browser. The figures you type are not sent to CORAA or stored. Check the result against your firm's methodology before relying on it.

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