What is the interest rate on federal taxes owed?

3%
You’ll usually have interest on any unpaid tax from the due date of the return until the payment date. The IRS interest rate is the federal short-term rate plus 3%. The rate is set every three months, and interest is compounded daily. The interest rate recently has been about 5%.

How do I calculate IRS interest?

Interest is computed to the nearest full percentage point of the Federal short term rate for that calendar quarter, plus 3%. Calculate interest by multiplying the factor provided in Rev. Rul. 2018-07 by the amount owing.

How are late IRS penalties calculated?

The late payment penalty is 0.5% of the tax owed after the due date, for each month or part of a month the tax remains unpaid, up to 25%. You won’t have to pay the penalty if you can show reasonable cause for the failure to pay on time.