Tax Extension Cost Calculator
| Owed | 3 mo late | 6 mo late | 12 mo late |
|---|---|---|---|
| $2,000 | $65 | $130 | $260 |
| $5,000 | $163 | $325 | $650 |
| $10,000 | $325 | $650 | $1,300 |
Filed on time, paid late - the cheapest row of the IRS menu. Unfiled returns add the 4.5%-a-month late-file layer on top.
The most expensive tax misconception is that an extension postpones payment. It only postpones paperwork: file Form 4868 and you get until October 15 to file the return, but whatever you owed on April 15 has been accruing charges since spring. The IRS stack has three layers - a failure-to-file penalty, a failure-to-pay penalty, and interest - and the calculator below prices all three on your actual balance.
The rates, straight from the IRS: 5 percent of the unpaid tax per month the return is late, up to 25 percent, minus the 0.5 percent late-pay penalty running the same months, which nets 4.5 percent a month for as long as the return is unfiled - five months and it maxes. The late-pay penalty alone is 0.5 percent a month, also capped at 25 percent. Interest currently runs 7 percent a year, the rate the IRS set for the fourth quarter of 2026, and it applies whether or not you filed. A return more than 60 days late carries a minimum penalty of $525 on small balances, for returns due after December 31, 2025.
How to use
- Type the tax you still owe from your spring return (not your refund, not your income - the balance-due line), then the months it has been unpaid since April 15.
- Say whether the return itself went in on time: filed in April, filed by the October extension, or still unfiled - the late-file penalty turns on that answer.
- Read the three-layer breakdown: late-file (only if unfiled), late-pay and 7 percent interest. If you can pay anything before October 15, the per-month layers shrink the same week.
Frequently asked questions
Does a tax extension cost anything by itself?
No - filing Form 4868 is free and automatic, and it moves the filing deadline to October 15. What costs money is any tax you owed on April 15 that you have not paid: the late-pay penalty and interest start regardless of your extension. The extension is free; the unpaid balance is not.
What is the penalty if I file but cannot pay?
Half a percent of the unpaid tax per month, up to 25 percent, plus interest at 7 percent a year for late 2026. The failure-to-file penalty does not apply because your return is in. If you set up an IRS installment agreement, the monthly rate drops from 0.5 percent to 0.25 percent while the plan runs - still not cheap, but half.
How bad is not filing at all?
Five times worse: 5 percent per month capped at 25 percent, offset by the 0.5 percent late-pay charge for a net 4.5 percent a month, and a $525 minimum on any balance if the return is more than 60 days late. After five months the late-file penalty stops growing, but the late-pay penalty and interest keep running - and the clock on audit and collection never starts until you file.
Is the interest rate permanent?
No - the IRS resets it every calendar quarter based on federal short-term rates; 7 percent is the fourth-quarter 2026 rate for individual underpayments. The quarterly announcement comes from the IRS newsroom, so check the current rate if you are estimating months from now. We charge it simple in the calculator; the real bill compounds daily, which drifts a few dollars higher over a year.