Interest-based penalty for paying too little tax during the year through withholding and estimates, computed quarter by quarter.
It is not large per dollar (7 percent annualized for individuals in late 2026, compounded daily) but it accrues from each missed quarterly date, and it applies even if you pay in full in April. Safe harbor payments avoid it entirely.
In limited cases: a casualty, disaster, or the first year of retirement or disability. Otherwise it applies mechanically.
Last reviewed September 15, 2026. Tax rules change; confirm current law before acting.
A confidential consultation. Tell us what you have, and we will tell you what applies and what it costs.
Hourly billing, estimated up front, with a deposit applied to the work.
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