The rate is 7% a year for the quarter that began July 1, 2026 (Rev. Rul. 2026-10). It is not a flat fine: under IRC §6654 the IRS charges simple interest on each late or short installment — shortfall × rate × days ÷ 365 — so a $5,000 shortfall left outstanding for a quarter costs about $86. The rate is re-determined every calendar quarter, and no penalty applies at all when the total shortfall is under $1,000.
Every announced quarterly rate
| Quarter beginning | Annual rate | Announced in |
|---|---|---|
| April 1, 2025 | 7% | Rev. Rul. 2025-7 |
| July 1, 2025 | 7% | Rev. Rul. 2025-11 |
| October 1, 2025 | 7% | Rev. Rul. 2025-18 |
| January 1, 2026 | 7% | Rev. Rul. 2025-22 |
| April 1, 2026 | 6% | Rev. Rul. 2026-5 |
| July 1, 2026 | 7% | Rev. Rul. 2026-10 |
The rate is the federal short-term rate plus three points, re-set each calendar quarter in a Revenue Ruling. The quarter beginning October 1, 2026 has not been published yet, so it is not quoted here.
What the rate costs on a shortfall
| Shortfall | 30 days | 90 days | 365 days |
|---|---|---|---|
| $1,000 | $6 | $17 | $70 |
| $5,000 | $29 | $86 | $350 |
| $10,000 | $58 | $173 | $700 |
| $25,000 | $144 | $432 | $1,750 |
Each cell is shortfall × rate × days ÷ 365 at the current rate. The interest is simple — it does not compound — and each quarter is measured separately, from its own due date until the shortfall is paid or until the filing deadline, whichever comes first. Because the charge is proportional to time, paying a missed installment late is always cheaper than not paying it.
The 2026 installment dates the clock runs from
| Installment | Due date |
|---|---|
| Q1 | April 15, 2026 |
| Q2 | June 15, 2026 |
| Q3 | September 15, 2026 |
| Q4 | January 15, 2027 |
| Interest stops accruing | April 15, 2027 |
Three safe harbors end the charge entirely: paying 90% of this year's tax, paying 100% of last year's (110% if your prior-year AGI was above $150,000), or owing less than $1,000 after withholding. Withholding counts as paid evenly across the year regardless of when it was actually withheld, which is why a late-year withholding top-up can cure earlier quarters that an estimated payment cannot. The underpayment penalty calculator applies all of this to your own quarters and dates.
Methodology
Rates, due dates and thresholds read from QuantCalc's 2026 estimated-tax module (RATE_SCHEDULE, dueDates(), DE_MINIMIS, HIGH_AGI_MULTIPLIER) — rates per IRC §6621 with each quarter's own Revenue Ruling cited above, installment dates per §6654(c)(2), the $1,000 floor per §6654(e)(1) and the 110% prior-year harbor per §6654(d)(1)(C). The interest figures use the same §6654 convention as the underpayment penalty calculator: shortfall × rate × days ÷ 365, simple.
Every figure on this page is computed at build time from QuantCalc's parity-tested calculation modules or a committed dataset — never hand-entered. Reference for research and planning only; not tax, legal, or investment advice.
Model this for your own numbers
The free QuantCalc calculator applies the same brackets to your actual income and gains.
Open the free calculator →Harvesting gains and losses across a portfolio? See the Tax Tools suite.
Changelog
- v2026.1 — first publication. Figures computed from the 2026 tax-constants mirror and committed datasets.
Cite this dataset
QuantCalc Research (2026). What is the IRS underpayment penalty rate right now?. https://quantcalc.app/answers/irs-underpayment-penalty-rate/ (accessed <date>).
BibTeX
@misc{quantcalc2026whatistheirsunderpaymentpenaltyrateright,
title = {What is the IRS underpayment penalty rate right now?},
author = {{QuantCalc Research}},
year = {2026},
url = {https://quantcalc.app/answers/irs-underpayment-penalty-rate/},
note = {Accessed <date>}
}Machine-readable citation metadata (schema.org identifier and citation fields) is embedded in this page's JSON-LD, at the stable identifier https://quantcalc.app/answers/irs-underpayment-penalty-rate/.