Underpayment Penalty Calculator for Estimated Tax (Form 2210)

“Except as provided in paragraph (2), the amount of any required installment shall be 25 percent of the required annual payment.”

“For purposes of subparagraph (A), the term “required annual payment” means the lesser of— (i) 90 percent of the tax shown on the return for the taxable year (or, if no return is filed, 90 percent of the tax for such year), or (ii) 100 percent of the tax shown on the return of the individual for the preceding taxable year. Clause (ii) shall not apply if the preceding taxable year was not a taxable year of 12 months or if the individual did not file a return for such preceding taxable year.”

“If the adjusted gross income shown on the return of the individual for the preceding taxable year beginning in any calendar year exceeds $150,000, clause (ii) of subparagraph (B) shall be applied by substituting “110 percent” for “100 percent”.”

“In the case of a married individual (within the meaning of section 7703) who files a separate return for the taxable year for which the amount of the installment is being determined, clause (i) shall be applied by substituting “$75,000” for “$150,000”.”

“In general, you may owe the penalty for 2025 if the total of your withholding and timely estimated tax payments didn’t equal at least the smaller of: 1. 90% of your 2025 tax, or 2. 100% of your 2024 tax. Your 2024 tax return must cover a 12-month period. Special rules for certain individuals. Different percentages are used for farmers and fishers, and certain higher income taxpayers. Farmers and fishers. If at least two-thirds of your gross income for 2024 or 2025 is from farming and fishing, substitute 66⅔% for 90% in (1) above. Higher income taxpayers. If your adjusted gross income (AGI) for 2024 was more than $150,000 ($75,000 if your 2025 filing status is married filing separately), substitute 110% for 100% in (2) above.”

“To figure your 2024 tax, first add the amounts listed in (1) below, then subtract from that total amount the refundable credits listed in (2), later, that are shown on your 2024 tax return.”

“Except as otherwise provided in this section, in the case of any underpayment of estimated tax by an individual, there shall be added to the tax under chapter 1, the tax under chapter 2, and the tax under chapter 2A for the taxable year an amount determined by applying— (1) the underpayment rate established under section 6621, (2) to the amount of the underpayment, (3) for the period of the underpayment.”

“The period of the underpayment shall run from the due date for the installment to whichever of the following dates is the earlier— (A) the 15th day of the 4th month following the close of the taxable year, or (B) with respect to any portion of the underpayment, the date on which such portion is paid.”

“For purposes of paragraph (2)(B), a payment of estimated tax shall be credited against unpaid required installments in the order in which such installments are required to be paid.”

“Use the penalty worksheet (Worksheet for Form 2210, Part III, Section B Figure the Penalty) to figure your penalty for each period by applying the appropriate rate against each underpayment shown in Section A, line 17. The penalty is figured for the number of days that each underpayment remains unpaid. Your payments are applied first to any underpayment balance on an earlier installment even if you designate a payment for a later period. Use lines 3, 6, 9, and 12 of the penalty worksheet to show the number of days an underpayment remained unpaid. Use lines 4, 7, 10, and 13 to figure the actual penalty amount by applying the appropriate rate to an underpayment for the number of days it remained unpaid.”

“You had a $500 underpayment remaining after your April 15 payment. The June 15 installment required a payment of $1,200. On June 10, you made a payment of $1,200 to cover the June 15 installment. However, $500 of this payment is applied first to the April 15 installment. The penalty for the April 15 installment is figured from April 15 to June 10 (56 days). The amount remaining to be applied to the June 15 installment is $700.”

“In determining the addition to tax under section 6654 for failure to pay estimated tax for any taxable year, the Federal short-term rate which applies during the 3rd month following such taxable year shall also apply during the first 15 days of the 4th month following such taxable year.”

“If an underpayment remained unpaid for an entire rate period, use Table 2 below to determine the number of days to enter in each column.”

“Using the same facts as Example 3 above, enter “15” (number of days from 04/15 to 04/30) and “61” (number of days from 04/15 to 06/15) on line 3, column (a).”

“Assume the same facts as in Example 3, earlier. On line 4, enter the penalty for each underpayment: “$5.75” ($2,000 × (15 ÷ 365) × 0.07) and “$23.40” ($2,000 × (61 ÷ 365) × 0.07).”

“Generally, if a due date for performing any act for tax purposes falls on a Saturday, Sunday, or legal holiday, the act is considered to be performed timely if it’s performed no later than the next day that isn’t a Saturday, Sunday, or legal holiday. A legal holiday includes any legal holiday in the District of Columbia.”

“Any payment made on your balance due return for 2025. Use the date you filed (or will file) your return or April 15, 2026, whichever is earlier, as the payment date for these purposes.”

“Note: If any payment due date (“through date”) occurs on a Sunday, Saturday, or legal holiday, and a payment is made on the next day that is not a Sunday, Saturday, or legal holiday, the payment is considered made on the due date.”

“When figuring your payment dates and the amounts to enter on line 11 of each column, apply the following rules. • For withheld federal income tax and excess social security or tier 1 RRTA, you are considered to have paid one-fourth of these amounts on each payment due date unless you can show otherwise.”

“If you treat withholding as paid on the dates it was actually withheld for estimated tax purposes, you must check box D in Part II and complete and attach Form 2210 to your return.”

“For purposes of applying this section, the amount of the credit allowed under section 31 for the taxable year shall be deemed a payment of estimated tax, and an equal part of such amount shall be deemed paid on each due date for such taxable year, unless the taxpayer establishes the dates on which all amounts were actually withheld, in which case the amounts so withheld shall be deemed payments of estimated tax on the dates on which such amounts were actually withheld.”

“Include all estimated tax payments you made for each period. Include any overpayment from your 2024 tax return you elected to apply to your 2025 estimated tax. If your 2024 return was fully paid before April 15, 2025, treat the overpayment as a payment made on April 15, 2025. If you mail your estimated tax payments, use the date of the U.S. postmark as the date of payment.”

“If you file your return and pay the tax due by January 31, 2026, include on line 11, column (d), the amount of tax you pay with your tax return. In this case, you won’t owe a penalty for the payment due on January 15, 2026.”

“If, on or before January 31 of the following taxable year, the taxpayer files a return for the taxable year and pays in full the amount computed on the return as payable, then no addition to tax shall be imposed under subsection (a) with respect to any underpayment of the 4th required installment for the taxable year.”

“The underpayment rate established under this section shall be the sum of— (A) the Federal short-term rate determined under subsection (b), plus (B) 3 percentage points.”

“The Secretary shall determine the Federal short-term rate for the first month in each calendar quarter.”

“Except as provided in subparagraph (B), the Federal short-term rate determined under paragraph (1) for any month shall apply during the first calendar quarter beginning after such month.”

“Under the Internal Revenue Code, the rate of interest is determined on a quarterly basis. For taxpayers other than corporations, the overpayment and underpayment rate is the federal short-term rate plus 3 percentage points.”

“The Internal Revenue Service today announced interest rates will remain the same for the calendar quarter beginning April 1, 2025. For individuals, the rate for overpayments and underpayments will be 7% per year, compounded daily.”

“The Internal Revenue Service announces that interest rates will remain the same for the calendar quarter beginning July 1, 2025. For individuals, the rate for overpayments and underpayments will be 7% per year, compounded daily.”

“The Internal Revenue Service today announced that interest rates will remain the same for the calendar quarter beginning Oct. 1, 2025. For individuals, the rate for overpayments and underpayments will be 7% per year, compounded daily.”

“The Internal Revenue Service today announced that interest rates will remain the same for the calendar quarter beginning Jan. 1, 2026. For individuals, the rate for overpayments and underpayments will be 7% per year, compounded daily.”

“The rates for interest determined under Section 6621 of the code for the calendar quarter beginning April 1, 2026, will be 6 percent for overpayments (5 percent in the case of a corporation), 6 percent for underpayments, and 8 percent for large corporate underpayments.”

“The rates for interest determined under Section 6621 of the code for the calendar quarter beginning July 1, 2026, will be 7 percent for overpayments (6 percent in the case of a corporation), 7 percent for underpayments, and 9 percent for large corporate underpayments.”

“The Internal Revenue Service today announced that interest rates will remain the same for the calendar quarter beginning Oct. 1, 2026. For individuals, the rate for overpayments and underpayments will be 7% per year, compounded daily.”

“Sections 6654(a)(1) and 6655(a)(1) provide that the underpayment rate established under section 6621 applies in determining the addition to tax under sections 6654 and 6655 for failure to pay estimated tax for any taxable year. Thus, the 6 percent rate also applies to estimated tax underpayments for the second calendar quarter beginning April 1, 2026. Pursuant to section 6621(b)(2)(B), in determining the addition to tax under section 6654 for any taxable year for an individual, the federal short-term rate that applies during the third month following the taxable year also applies during the first 15 days of the fourth month following the taxable year. See Rev. Rul. 2025-22, 2025-48 IRB 719 (7 percent rate for the first quarter of 2026).”

“No addition to tax shall be imposed under subsection (a) for any taxable year if the tax shown on the return for such taxable year (or, if no return is filed, the tax), reduced by the credit allowable under section 31, is less than $1,000.”

“No addition to tax shall be imposed under subsection (a) for any taxable year if— (A) the preceding taxable year was a taxable year of 12 months, (B) the individual did not have any liability for tax for the preceding taxable year, and (C) the individual was a citizen or resident of the United States throughout the preceding taxable year.”

“You won’t have to pay the penalty or file this form if either of the following applies. • You had no tax liability for 2024, you were a U.S. citizen or resident alien for the entire year (or an estate of a domestic decedent or a domestic trust), and your 2024 tax return was (or would have been had you been required to file) for a full 12 months. • The total tax shown on your 2025 return minus the amount of tax you paid through withholding is less than $1,000. To determine whether the total tax is less than $1,000, complete Part I, lines 1 through 7.”

“If you meet both tests 1 and 2 below, you don’t owe a penalty for underpaying estimated tax. 1. Your gross income from farming or fishing is at least two-thirds of your annual gross income from all sources for 2024 or 2025. 2. You filed Form 1040, 1040-SR, or 1041 and paid the entire tax due by March 2, 2026. See chapter 2 of Pub. 505, Tax Withholding and Estimated Tax, for the definition of gross income from farming and fishing. If you meet test 1 but not test 2, use Form 2210-F, Underpayment of Estimated Tax by Farmers and Fishers, to see if you owe a penalty. When using Form 2210-F, refer to the Instructions for Form 2210-F, which discuss special rules that may apply. If you don’t meet test 1, use Form 2210.”

“If an individual is a farmer or fisherman for any taxable year— (A) there shall be only 1 required installment for the taxable year, (B) the due date for such installment shall be January 15 of the following taxable year, (C) the amount of such installment shall be equal to the required annual payment determined under subsection (d)(1)(B) by substituting “66⅔ percent” for “90 percent” and without regard to subparagraph (C) of subsection (d)(1), and (D) subsection (h) shall be applied— (i) by substituting “March 1” for “January 31”, and (ii) by treating the required installment described in subparagraph (A) of this paragraph as the 4th required installment.”

“No addition to tax shall be imposed under subsection (a) with respect to any underpayment to the extent the Secretary determines that by reason of casualty, disaster, or other unusual circumstances the imposition of such addition to tax would be against equity and good conscience.”

“No addition to tax shall be imposed under subsection (a) with respect to any underpayment if the Secretary determines that— (i) the taxpayer— (I) retired after having attained age 62, or (II) became disabled, in the taxable year for which estimated payments were required to be made or in the taxable year preceding such taxable year, and (ii) such underpayment was due to reasonable cause and not to willful neglect.”

“If you have an underpayment, all or part of the penalty for that underpayment will be waived if the IRS determines that: • In 2024 or 2025, you retired after reaching age 62 or became disabled, and your underpayment was due to reasonable cause (and not willful neglect); or • The underpayment was due to a casualty, disaster, or other unusual circumstance, and it would be inequitable to impose the penalty. For federally declared disaster areas, see Federally declared disaster, later.”

“In the case of any required installment, if the individual establishes that the annualized income installment is less than the amount determined under paragraph (1)— (i) the amount of such required installment shall be the annualized income installment, and (ii) any reduction in a required installment resulting from the application of this subparagraph shall be recaptured by increasing the amount of the next required installment determined under paragraph (1) by the amount of such reduction (and by increasing subsequent required installments to the extent that the reduction has not previously been recaptured under this clause).”

“If your income varied during the year because, for example, you operated your business on a seasonal basis or had a large capital gain late in the year, you may be able to lower or eliminate the amount of one or more required installments by using the annualized income installment method. Use Schedule AI to figure the required installments to enter on Form 2210, Part III, line 10.”

“Enter on line 10, columns (a) through (d), the amount of your required installment for the due date shown in each column heading. For most taxpayers, this is one-fourth of the required annual payment shown on Part I, line 9. However, it may be to your benefit to figure your required installments by using the annualized income installment method. See the Schedule AI—Annualized Income Installment Method instructions, later.”

“The penalty is figured separately for each installment due date. Therefore, you may owe the penalty for an earlier due date even if you paid enough tax later to make up the underpayment. This is true even if you’re due a refund when you file your tax return. However, you may be able to reduce or eliminate the penalty by using the annualized income installment method. For details, see Schedule AI—Annualized Income Installment Method, later.”

“Use Form 2210 to see if you owe a penalty for underpaying your estimated tax. The IRS will generally figure your penalty for you and you should not file Form 2210. You can, however, use Form 2210 to figure your penalty if you wish to include the penalty on your return. There are some situations in which you must file Form 2210, such as to request a waiver.”

“If you didn’t check box B, C, or D in Part II, you don’t need to figure the penalty. The IRS will figure any penalty for underpayment of estimated tax and send you a bill. If you file your 2025 return by April 15, 2026, no interest will be charged on the penalty if you pay the penalty by the date shown on the bill. If you want us to figure the penalty for you, complete your return as usual. Leave the penalty line on your return blank; don’t file Form 2210.”

“There are different ways to figure the correct penalty. You don’t have to use the method used on Form 2210 as long as you enter the correct penalty amount on the “Estimated tax penalty” line on your return.”

“Draft versions of tax forms, instructions, and publications. Do not file draft forms and do not rely on information in draft instructions or publications.”