> ## Content Index > Fetch the complete content index at: https://the-wealth-habit.ghost.io/llms.txt > Use this file to discover other available public pages before exploring further. # The IRS underpayment rate stays at 7% for Q4 - URL: https://the-wealth-habit.ghost.io/the-irs-underpayment-rate-stays-at-7-for-q4/ - Published: 2026-08-25T11:25:10.000Z - Updated: 2026-08-25T11:25:10.000Z - Author: Robert Kessler The IRS set its fourth-quarter rates on August 21. Nothing moved. For individuals, the rate on both underpayments and overpayments holds at 7% a year, compounded daily, for the quarter beginning October 1, 2026, per Revenue Ruling 2026-15\. And that 7% is what a shortfall costs you, charged from the day that installment came due, not from the day you file your return in April. Confirm your coverage before September 15. Nothing in the 2027 Part D news changes what you pay today. CMS published its bid figures on July 28\. The Part D base beneficiary premium goes to $41.33 next year, up from $38.99 in 2026, and the Premium Stabilization Demonstration ends when 2026 does. But your own plan's premium has not been set — CMS releases the 2027 landscape mid-to-late September. Do nothing now. Read your Annual Notice of Change when it arrives. --- ### Today's Habit *Run the safe-harbor check on your 2026 tax payments.* **Why it matters.** A gap costs you money you never see on a statement. The federal income tax runs pay-as-you-go. So the IRS scores you by payment period, not by year, and a shortfall in one period earns interest even after you square the total in April. Nobody sends you a bill for it, either. The interest surfaces on the return you file next spring, on a line called "Estimated tax penalty." But the prior-year test takes the guessing out. Your 2025 return already holds the number you have to beat. **What it costs to skip it.** Say you're $8,000 short for a single payment period. At 7%, that's roughly $140. Short by the same $8,000 across the full year? Closer to $560. Both are avoidable in ten minutes. **How.** 1. Open your 2025 Form 1040\. Line 24 is your total tax; line 11 is your AGI. 2. Multiply line 24 by 1.10 if line 11 came in over $150,000 — $75,000 if you file separately — and by 1.00 if it didn't. That's your 2026 target. 3. Add up your 2026 withholding so far: Social Security (Form W-4V, which nobody at the field office brings up), pensions and IRA distributions (Form W-4R), plus any estimated payments you've already sent. Your IRS Online Account lists the payments. 4. Project that total forward to December 31 and set it against the target. 5. Short? Raise the withholding on a remaining IRA distribution — withholding counts as paid evenly across the year under section 6654(g), whenever you actually do it — or send the difference through IRS Direct Pay by September 15. **When it's done.** You have one number on paper: what you'll have paid into 2026 by December 31, against your target. Clear, and you stop. Short, and you know by how much, and you know the date it has to be there. --- ### The Fine Print The IRS says it plainly on its own estimated-tax page: you may be charged a penalty even if you're due a refund. A refund in April undoes nothing. The interest is figured separately for each payment period, and a gap that opened in June stays open. And the periods aren't quarters. The IRS splits 2026 this way: January 1 to March 31, due April 15\. April 1 to May 31, due June 15\. June 1 to August 31, due September 15\. September 1 to December 31, due January 15, 2027. The second period runs two months. The third runs three. So a Roth conversion you ran in July belongs to the period closing September 15, and the tax on it comes due then — not in April, and not in January. Same for a capital gain realised in June, or a lump sum you pulled in August. If you converted, sold, or took a distribution between June 1 and August 31, run the September 15 number this week. --- ### On the Calendar > September 15, 2026 — Third 2026 estimated tax installment due (IRS). > September 30, 2026 — Medicare Advantage and Part D plans must deliver your 2027 Annual Notice of Change (CMS). > October 1, 2026 — The 7% IRS interest quarter begins. > October 15, 2026 — Medicare open enrollment opens. Closes December 7, 2026. — Robert Kessler