The tax is only the first number. Watch what penalties and daily-compounding interest do to it.
Enter your best estimate below. The result is a planning estimate — not the exact figure the IRS would assess (see how the math works).
Estimate only, not tax advice. Accrual start dates vary by notice type and tax year; the IRS also charges interest on assessed penalties, so your actual balance may run higher. IRS interest rates reset each calendar quarter — this calculator uses the Q4 2026 rate (7%/yr, IR-2026-98).
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Nothing hidden. These are the IRS rules the calculator applies:
With over two decades in accounting, Alex has watched these numbers surprise people for years. The earlier you act, the smaller the second half of that stack gets.
No. Interest can never be abated — not for first-time relief, not for reasonable cause. It accrues daily, and rates reset each quarter. That's why speed matters: the interest portion of your balance only moves one direction.
5% of the unpaid tax for each month (or part of a month) the return is late, capped at 25%. If the return is more than 60 days late, the minimum is $525 (for 2026 returns) or 100% of the tax — whichever is less.
0.5% of the unpaid tax per month, capped at 25%. If you're in an installment agreement, it drops to 0.25% per month while the agreement is active.
When both penalties apply in the same month, their combined total is capped at 47.5% of the unpaid tax.
It halves the failure-to-pay penalty to 0.25% per month. It does not stop interest, and it doesn't reduce the failure-to-file penalty.
No — it's a planning estimate, not tax advice. Accrual start dates vary by notice type and tax year, and the IRS also charges interest on assessed penalties. For the exact figure, Alex can pull your IRS transcript — that's the $350 transcript review.
DISCLOSURE: General information only — not tax, legal, or financial advice. Calculator results are planning estimates, not the exact figure the IRS would assess. A professional engagement is contingent upon the mutual execution of a formal Engagement Letter.
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