How to Calculate IRS Late Charges

by Matt McGew

The Internal Revenue Service imposes a late fee on taxpayers who do not pay the full amount of tax owed by the due date, which is April 15 in most cases. The late fee also differs from interest charges that the IRS also imposes on late tax payments. The late fee assessed by the IRS is 0.5 percent per month, or partial month, up to a maximum of 25 percent. You can manually calculate the specific late charge the IRS will impose on your overdue tax balance.

1. Determine the amount of tax owed to the IRS and not paid by the April 15 due date. For example, assume you owe the IRS $20,000.

2. Determine the number of months your tax payment is late. For example, assume your tax payment is 20 months late.

3. Multiply the per month penalty of 0.5 percent by the number of months your tax is late. Continuing the same example, .5 x 20 = 10 percent. Should this figure exceed, 25 percent, you would use the 25 percent figure as this is the maximum late fee imposed by the IRS.

4. Multiply the late fee percentage by the tax due. Continuing the same example, 0.10 x $20,000 = $2,000. This figure represents the total last charges owed to the IRS.


  • Once the IRS sends a notice of intent to levy, the fee penalty increases to 1 percent per month. Additionally, if you negotiate a payment plan with the IRS, the fee penalty decreases to .25 percent per month.

About the Author

Since 1992 Matt McGew has provided content for on and offline businesses and publications. Previous work has appeared in the "Los Angeles Times," Travelocity and "GQ Magazine." McGew specializes in search engine optimization and has a Master of Arts in journalism from New York University.