IRR CalculatorFree online financial calculator — instant results, no sign-up
Internal rate of return for a series of cash flows.
Estimates only, based on the inputs and assumptions shown. This is not financial, investment, tax, or legal advice. Prices, rates and local rules may change; crypto scenarios do not predict returns. Confirm important decisions with a qualified professional.
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About the IRR Calculator
This calculator computes the internal rate of return (IRR) and net present value at a baseline 10% discount rate for a sequence of periodic cash flows. Investors, corporate analysts, and project managers use IRR to evaluate the annualized profitability of potential investments and capital allocation decisions.
- Cash flows (first is investment, negative)
- A comma- or space-separated list of periodic values. The first value is usually a negative cash outflow representing the initial outlay, followed by subsequent inflows or outflows.
Formula and method
0 = sum(CF_t / (1 + IRR)^t) for t = 0 to n; NPV @ 10% = sum(CF_t / (1 + 0.10)^t) for t = 0 to n
- CF_tCash flow at period t (where t = 0 is the initial period)
- IRRInternal rate of return that sets the net present value to zero
- tTime period index (0, 1, 2, ..., n)
- NPV @ 10%Net present value discounted at a fixed 10% annual rate (r = 0.10)
Because the IRR polynomial cannot generally be solved algebraically, the calculator uses a bisection search across 200 iterations between -99% and 1,000% to locate the discount rate where NPV equals zero. The resulting IRR is rounded to three decimal places, and the baseline NPV is evaluated directly at r = 0.10.
Worked example
These are the calculator's starting values and the results it actually produces for them.
Inputs
- Cash flows (first is investment, negative)-10000, 3000, 4000, 4000, 3000
Results
- IRR14.895%
- NPV @ 10%$1,087.36
How to use the IRR Calculator
- 1Enter the sequence of cash flows separated by commas or spaces, starting with the initial negative outlay.
- 2Calculate the net present value across the cash stream at a reference discount rate of 10%.
- 3Run a 200-iteration bisection search across the discount rate range [-0.99, 10.0] to find the rate where NPV equals zero.
- 4Display the resulting IRR rounded to three decimal places alongside the benchmark NPV at 10%.
Reading your result
An IRR higher than your project's hurdle rate or cost of capital indicates an investment that adds value over its life. The accompanying NPV at 10% provides a dollar-denominated benchmark: a positive value shows the project exceeds a 10% return threshold, while a negative value shows it falls short.
Limitations
The bisection search assumes standard cash flow patterns where NPV decreases monotonically as the discount rate rises; non-conventional cash flows with multiple sign changes may produce multiple internal rates or fail to converge to secondary roots. It also assumes equal intervals between cash flows and reinvestment of proceeds at the IRR itself rather than the cost of capital.
Common questions
What happens if all cash flows are positive or all are negative?+
IRR requires at least one cash outflow and one cash inflow to produce a sign change; if all values have the same sign, the net present value never crosses zero within a standard rate range, and the solver will hit its search boundary.
Why does the tool show NPV at 10% alongside IRR?+
IRR only reveals a rate of return percentage, which can obscure project scale. Presenting NPV at a standard 10% discount rate gives a concrete dollar measure of potential profit against a common hurdle rate.
Can periods represent months instead of years?+
Yes, but the resulting IRR will reflect the rate per period. If cash flows are monthly, the output is a monthly IRR rather than an annualized rate.
Does the calculator save my information?+
Calculations run in your browser. While signed in, inputs and results are automatically recorded in account history; saving a result creates a separate saved record.
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Results are estimates for informational purposes and are not financial, medical or legal advice.