CD Early Withdrawal Penalty Calculator
Estimate a certificate-of-deposit early-withdrawal penalty from an entered nominal annual interest rate and penalty period.
Method checked 2026-09-30 · Methods & sources · Examples are estimates, not current offers or quotes.
Your estimate
Fill in the inputs and select Calculate. Results clear when you change an input so you can compare a fresh estimate.
How this calculator works
Calculates earned interest as principal × entered nominal annual rate × months held / 12; it does not convert an APY into a nominal rate.
For a days-based penalty, converts entered days to years using 365 days. For a months-based penalty, converts entered months to years using 12 months.
Calculates the penalty from principal and the selected interest period, then shows any amount above earned interest as principal erosion and subtracts the penalty from estimated proceeds.
Worked example
Worked example: withdrawing $10,000 after 3 months at a 4.80% nominal annual rate earns $120.00 in this simple-interest estimate. A 6-month penalty is $240.00, so $120.00 of the penalty erodes principal.
How CD early-withdrawal penalties work
A certificate of deposit pays a fixed rate in exchange for leaving the money in place until the maturity date. If you take money out sooner, the bank charges an early-withdrawal penalty. Most banks state it as an amount of interest, such as 90 days or 6 months of interest, and the length usually rises with the term of the CD. The penalty is set by your account agreement, not by a single national rule, so two banks can charge very different amounts on the same balance.
The penalty is a fixed number of days or months of interest, not a share of the time you have already held the CD. Capital One’s disclosure, for example, says the penalty applies regardless of when before maturity you redeem. What changes is how much interest you have earned to absorb it. Withdraw early enough and the penalty can be larger than the interest earned, in which case several banks below say the difference comes out of principal. That is why the calculator above shows earned interest, the penalty, and any principal erosion as separate lines.
Whether the penalty applies to the whole balance or only the amount you withdraw also depends on the bank. Some banks compute it on the amount withdrawn. Others, including Ally and Capital One in the table below, do not allow early partial withdrawals at all: you close the CD or you leave it alone. Check whether your bank also requires you to repay anything else, such as a cash bonus (Bank of America says it does), and whether it waives the penalty in cases such as the death or legal incompetence of the account owner, which several banks below say they do.
To use the calculator, enter the amount you would withdraw, the nominal annual rate stated in your account agreement, the months you have held the CD, and the penalty as your agreement words it. If the agreement says 90 days of interest, choose days and enter 90; if it says 6 months of interest, choose months and enter 6. Do not enter the APY as the rate, because APY already includes compounding.
Early-withdrawal penalties at major US banks
The table lists the penalty rules published by each bank for its standard consumer CDs, taken from the bank’s own help page, disclosure, or account agreement (linked in each row) and reviewed on September 30, 2026. Terms and rates change, and special CD types can differ, so confirm the wording in your own agreement before you rely on a figure.
| Bank | Penalty by CD term | Other terms stated by the bank | Official source (reviewed 2026-09-30) |
|---|---|---|---|
| Ally Bank | Less than 3 months: 30 days of interest. 3 to 24 months: 60 days. 25 to 36 months: 90 days. 37 to 48 months: 120 days. 49 months or longer: 150 days. | Deducted from accrued interest first, then principal if needed. No early partial withdrawals. The 11-month No Penalty CD has no penalty after the first 6 days from funding. Raise Your Rate CDs use the rate in effect on the day you request the withdrawal. Waived on the owner’s death or legal incompetence. | Ally CD FAQs |
| Capital One (360 CD) | 12 months or shorter: 3 months of interest. Longer than 12 months: 6 months of interest. | Charged regardless of when before maturity you redeem, and can exceed the interest earned, so principal can be reduced. No partial withdrawals of principal during the term. Early redemption without penalty if an owner dies or is declared legally incompetent. | Capital One 360 CD disclosures |
| Chase (personal CDs) | Term under 6 months: 90 days of interest on the amount withdrawn. 6 to under 24 months: 180 days. 24 months or longer: 365 days. | Each amount is stated as not more than the total interest earned during the current term. A withdrawal within 7 days of opening the CD or of a prior principal withdrawal carries a penalty of at least 7 days of interest. Chase states the penalty is deducted from principal. | Chase CD terms |
| Bank of America (personal CDs) | Term under 90 days: all interest earned on the amount withdrawn or 7 days of interest, whichever is greater. 90 days up to 12 months: 90 days of interest. 12 to 60 months: 180 days. 60 months or longer: 365 days. | Calculated on the amount withdrawn. Any cash bonus received for opening or reinvesting the account must be repaid. The Flexible CD carries a 7-day interest penalty only for withdrawals within the first 6 days of the term. | Bank of America CD and IRA FAQs |
| Wells Fargo (personal CDs) | Term under 90 days: 1 month of interest. 90 to 365 days: 3 months. Over 12 to 24 months: 6 months. Over 24 months: 12 months. | Wells Fargo lists these tiers on its CD overview page. Ask the bank about special-rate or other CD types. | Wells Fargo CD overview |
| American Express Savings | Term under 12 months: 90 days of interest on the withdrawn amount. 12 to under 48 months: 270 days. 48 to under 60 months: 365 days. | Uses the interest rate in your account-opening documents. If the penalty exceeds the interest earned or credited, the difference comes out of principal. May be waived on death or legal incompetence. The page lists no tier for terms of 60 months or longer; check the account agreement. | American Express CD early-withdrawal FAQ |
| Discover Bank | CDs opened or renewed on or after 2/17/2014: term under 1 year: 3 months of simple interest. 1 to under 4 years: 6 months. 4 to under 5 years: 9 months. 5 to under 7 years: 18 months. 7 years or longer: 24 months. | One month equals 30 days for the calculation. The agreement says the penalty may reduce principal. For a new CD, from the 8th day after funding for the next 22 days the bank deducts each day’s simple interest instead. Discover’s CD web pages now redirect to Capital One, so this row reflects the Discover deposit account agreement; confirm which agreement covers your CD. | Discover Deposit Account Agreement (PDF) |
Marcus by Goldman Sachs and Citi are not listed because their official pages could not be retrieved for verification on the review date.
Is it worth breaking a CD to reinvest at a higher rate?
When rates on new CDs rise above what you locked in, the question is whether the extra interest on a new CD will outweigh the penalty. Choose “Yes, compare break vs. keep” in the calculator, then enter the months left on your current term and the nominal rate on the new CD. It compares two outcomes on the same end date.
Keeping the CD means you end with your principal, the interest earned so far, and interest on both for the remaining months at your current rate. Breaking means you pay the penalty, put what is left into a new CD at the new rate for the same remaining months, and end with that balance plus its interest. The calculator reports both values, the dollar difference, and the new rate at which the two paths tie.
Two things usually decide the result. First, the size of the penalty relative to the balance: a 6-month penalty is a large hurdle when only a few months remain. Second, the gap between the two rates over the months left. A one-point rate gap on $10,000 is worth roughly $8 a month, so a penalty of a few hundred dollars needs many months to recover.
The comparison is deliberately simple. It uses simple interest, so it ignores compounding differences between the two CDs. It ignores income tax on the interest, and it does not model the penalty deduction described below. It assumes the new CD has no early-withdrawal penalty of its own and that the new term ends when the old one would have. It also ignores fees and any bonus you would have to repay. If the result is close, treat it as a tie and prefer the option with the terms you understand better.
How an early-withdrawal penalty is taxed
You still owe tax on all interest the bank credited to you, but the penalty is deductible. IRS Publication 550 explains that the Form 1099-INT you receive shows total interest in box 1 and the penalty separately in box 2. You include all interest shown in box 1 in income, and you can deduct the penalty on Schedule 1 (Form 1040), line 18, which is in the adjustments-to-income part of the schedule. The Instructions for Form 1040 make the same point for line 18: the Form 1099-INT or Form 1099-OID you received will show the penalty you were charged.
The Instructions for Form 1099-INT tell banks to report in box 2 the interest or principal forfeited because of an early withdrawal of a time deposit, such as a CD, that is deductible from gross income by the recipient, and not to reduce box 1 by that amount. That is why a penalty that eats into principal still shows up as a deduction. Line numbers can change between tax years, so confirm the current form and instructions before filing.
If your CD is held in an IRA, two different things can happen and they should not be confused. The bank penalty is a contract charge described in the table above. The IRS 10% additional tax on early distributions is a separate tax: under Publication 590-B, if you are under age 59½, you generally pay a 10% additional tax on the taxable part of a distribution from a traditional IRA, unless an exception applies. An early IRA CD withdrawal can therefore involve both a bank penalty and this tax, and the bank penalty is not the IRS tax. Ask a tax professional how to report an IRA CD withdrawal.
This page is general information, not tax advice. It does not know your filing status, your other income, or how your bank reported the penalty.
Common questions
Is APY interchangeable with the rate in this calculator?
No. APY includes compounding; this calculator requires the nominal annual rate stated in your agreement so its simple-interest estimate has a defined basis.
Can an early-withdrawal penalty reduce principal?
It can under some account agreements when the penalty is greater than interest earned. Check your bank’s contract because terms and exceptions vary.
Where is the early-withdrawal penalty reported on my taxes?
Your bank reports it in box 2 of Form 1099-INT. Per IRS Publication 550, you include the interest in box 1 as income and deduct the penalty on Schedule 1 (Form 1040), line 18. Confirm the line on the current-year form.
Can I withdraw only part of a CD?
It depends on the bank. Ally and Capital One say they do not allow early partial withdrawals, while Chase and Bank of America state their penalties on the amount withdrawn. Check your agreement before assuming a partial withdrawal is possible.
Is there a CD with no early-withdrawal penalty?
Some banks offer no-penalty CDs. Ally’s 11-month No Penalty CD, for example, lets you withdraw after the first 6 days from funding without a penalty. These CDs often pay a lower rate than a standard CD of similar length, so compare the rate before choosing one.
Is the bank penalty on an IRA CD the same as the IRS 10% early-distribution tax?
No. The bank penalty is a charge under your account agreement. The 10% additional tax is an IRS tax that generally applies to taxable distributions from a traditional IRA before age 59½, unless an exception applies (IRS Publication 590-B). They are separate, so check both before withdrawing.
Does this calculator account for taxes when comparing break versus keep?
No. The comparison is pre-tax and uses simple interest. It ignores compounding differences, income tax on interest, and the tax deduction for the penalty, so treat a close result as a tie.