How the IRS does the math
Each guide walks through the statute, the formula, and worked numbers. Pick a category or scroll the full list.
Penalties calculations
Failure-to-file, failure-to-pay, deposit and accuracy penalties, month by month.
How the Failure-to-File Penalty Is Calculated Under IRC 6651(a)(1)
Step-by-step failure-to-file penalty math under IRC 6651(a)(1): 5% per month or part of a month, the 25% cap, the net amount due, and worked examples.
open guide ->PenaltiesHow the Failure-to-Pay Penalty Is Calculated Under IRC 6651(a)(2)
How the IRS computes the failure-to-pay penalty: 0.5% per month on unpaid tax, how payments shrink the base month by month, and when it hits the 25% cap.
open guide ->PenaltiesFiling Late and Paying Late: The IRC 6651(c)(1) Overlap Math
When failure-to-file and failure-to-pay penalties run in the same month, IRC 6651(c)(1) offsets them. See the 5% monthly combined rate and the 47.5% maximum.
open guide ->PenaltiesThe Minimum Late-Filing Penalty: The 60-Day Rule and the Dollar Floor
How the minimum failure-to-file penalty works: when a return is more than 60 days late, the floor for 2026 returns, and worked examples for small balances.
open guide ->PenaltiesThe 0.25% Failure-to-Pay Rate During an Installment Agreement
IRC 6651(h) cuts the failure-to-pay penalty to 0.25% a month during an installment agreement, if you filed on time. See who qualifies and the math over two years.
open guide ->PenaltiesWhen the Failure-to-Pay Penalty Rises to 1% Per Month: IRC 6651(d)
A notice of intent to levy doubles the failure-to-pay penalty to 1% per month. See exactly which month the new rate starts and how fast it hits the 25% cap.
open guide ->PenaltiesIRC 6651(a)(3): The Failure-to-Pay Penalty on Assessed Deficiencies
How the failure-to-pay penalty works on audit and CP2000 assessments: the 21-day and 10-business-day grace periods, month counting, and worked examples.
open guide ->PenaltiesExtension Math: What Form 4868 Changes and What It Does Not
A filing extension moves the failure-to-file clock but not the payment clock. See the 90% rule under Treas. Reg. 301.6651-1(c)(3) and three worked examples.
open guide ->PenaltiesHow the 20% Accuracy-Related Penalty Is Calculated Under IRC 6662
How the IRS computes the 20% accuracy-related penalty: the substantial understatement test, the 10% or $5,000 threshold, reductions, and interest.
open guide ->PenaltiesThe Failure-to-Deposit Penalty Tiers: 2%, 5%, 10% and 15% Under IRC 6656
How the IRS computes the failure-to-deposit penalty on payroll taxes: the four tiers under IRC 6656, how deposits are applied, and a full worked quarter.
open guide ->PenaltiesRecomputing the Balance After a Penalty Is Abated
When the IRS abates a penalty, the interest charged on that penalty goes too. See the recomputation step by step, and why interest on the tax stays.
open guide ->Interest calculations
Daily compounding, quarterly rates, interest on penalties and refunds.
How IRS Interest Compounds Daily Under IRC 6622
How the IRS calculates interest on unpaid tax: the 6621 rate, daily compounding under IRC 6622, quarterly rate changes, and a worked 18-month example.
open guide ->InterestIRS Underpayment Interest Rates by Quarter, 2022 Through 2026
Every IRS underpayment and overpayment interest rate by quarter from 2022 through Q4 2026, how each rate is set under IRC 6621, and how to apply them.
open guide ->InterestWhen Interest Starts on IRS Penalties: The IRC 6601(e)(2) Rules
Some IRS penalties draw interest from the return due date; others only after notice and demand. See which is which under IRC 6601(e)(2), with worked numbers.
open guide ->InterestHot Interest: The Large Corporate Underpayment Rate Under IRC 6621(c)
How hot interest works for C corporations: the $100,000 threshold, the 30-day applicable date, the plus-5 rate, and a worked example with 2026 rates.
open guide ->InterestHow IRS Overpayment Interest on Refunds Is Calculated
When the IRS pays interest on a refund and how much: the 45-day rule, late returns, amended return claims, credits, and the 2026 overpayment rates under IRC 6611.
open guide ->InterestInterest Netting Under IRC 6621(d): Zero Net Rate Math
How interest netting works when you have an IRS underpayment and overpayment at once: the overlap period, the equal amount, and the rate spread recovered.
open guide ->Payments calculations
Where your payment actually lands on the account.
CSED calculations
The 10-year collection clock and every event that stops it.
How to Calculate a Collection Statute Expiration Date, Step by Step
How to compute the IRS collection statute expiration date: find the assessment date, add 10 years under IRC 6502, then add tolling days the way the IRM does.
open guide ->CSEDOne Tax Year, Several CSEDs: Calculating Each Assessment Separately
One tax year can carry several IRS collection statute dates. See which transaction codes start a new CSED and a worked example with three assessments.
open guide ->CSEDHow an Offer in Compromise Extends the CSED: Counting the Days
An offer in compromise stops the IRS collection clock while pending, for 30 days after rejection, and during appeal. See the IRC 6331(k) math with dated examples.
open guide ->CSEDInstallment Agreement Requests and the CSED: Tolling Math
A pending installment agreement request suspends the IRS collection statute; an agreement in effect does not. See the IRC 6331(k)(2) rules and dated examples.
open guide ->CSEDCollection Due Process Hearings and the CSED: Counting Suspension Days
A timely CDP hearing request suspends the IRS collection statute under IRC 6330(e)(1). See the 90-day floor, equivalent hearings, and dated examples.
open guide ->CSEDBankruptcy and the CSED: The Stay Period Plus Six Months
How a bankruptcy filing suspends the IRS collection statute under IRC 6503(h): the automatic stay plus six months, with Chapter 7 and Chapter 13 examples.
open guide ->CSEDLiving Outside the United States and the CSED: The IRC 6503(c) Rule
How time outside the U.S. suspends the IRS collection statute: the six-month continuous absence test, the six-months-after-return floor, and dated examples.
open guide ->TFRP calculations
How the trust fund recovery penalty is computed from Form 941.
Computing the Trust Fund Recovery Penalty Amount from Form 941
How the IRS computes the trust fund recovery penalty: which Form 941 lines are trust fund, how deposits are applied, and a worked quarter under IRC 6672.
open guide ->TFRPDesignating Payroll Tax Payments to Trust Fund Taxes: The Dollar Effect
A payroll tax payment designated to trust fund taxes can cut personal TFRP exposure dollar for dollar. See the IRM 5.7.4 rules and a three-outcome worked example.
open guide ->OIC calculations
Reasonable collection potential, equity and future income math.
The Reasonable Collection Potential Formula for an Offer in Compromise
How the IRS computes reasonable collection potential for an offer in compromise: equity plus future income, with a full worked example and the 20% rule.
open guide ->OICQuick Sale Value and Net Realizable Equity in an Offer in Compromise
How the IRS values assets in an offer in compromise: 80% quick sale value, priority liens, the $1,000 cash and $3,450 vehicle allowances, and retirement accounts.
open guide ->OICFuture Income in an Offer in Compromise: The 12-Month and 24-Month Multipliers
How the IRS computes the future income part of an offer in compromise: monthly disposable income times 12 or 24, the CSED limit, and worked examples from IRM 5.8.5.
open guide ->Background articles
Plain-language overviews of the IRS collection process.
- Offer in Compromise Explained
- IRS Installment Agreement Guide
- IRS Fresh Start Program Explained
- Currently Not Collectible Status
- IRS Wage Garnishment: How to Stop It
- IRS Bank Levy Release
- Tax Lien vs. Tax Levy
- IRS Penalty Abatement Explained
- IRS Audit: What to Expect
- IRS Appeals: How to Challenge a Decision
- Unfiled Tax Returns: What Happens
- Substitute for Return (SFR)
- Statute of Limitations on IRS Collections
- IRS Collections Process Timeline
- IRS Revenue Officer Assigned to Your Case
- Innocent Spouse Relief Guide
- Tax Debt After Divorce
- Payroll Tax Problems for Businesses
- Trust Fund Recovery Penalty
- Can Chapter 7 Discharge Tax Debt?
- Florida Homestead and IRS Protection
- Tax Debt and Retirement Accounts