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IRR Calculator
Find the discount rate that sets the net present value of the entered cash-flow series to zero.
IRR Calculator
Enter your numbers and the result updates straight away.
Outputs
Planning estimate only. Verify assumptions before making a financial decision.
A $100,000 investment returning $30,000 annually for five years produces an IRR of approximately 15.24%.
How this calculation works
The calculator solves for IRR numerically using a bounded bisection method. It treats the initial investment as a time-zero outflow and annual entries as end-of-year inflows.
How to interpret the result
Compare IRR with a defensible required return, but also inspect NPV and cash-flow scale. Non-conventional cash flows can produce multiple IRRs or no meaningful solution.
Limitations
Results are educational planning estimates. They do not include every tax, legal, accounting, financing, or business-specific consideration and are not professional advice.
Sources and further reading
Formula and example
A $100,000 investment returning $30,000 annually for five years produces an IRR of approximately 15.24%.
Common use cases
- Screen capital projects.
- Compare acquisition cash-flow cases.
- Evaluate an investment against a hurdle rate.
IRR Calculator FAQ
How is IRR calculated?
The calculator solves for IRR numerically using a bounded bisection method. It treats the initial investment as a time-zero outflow and annual entries as end-of-year inflows.
What should I check before using the result?
Compare IRR with a defensible required return, but also inspect NPV and cash-flow scale. Non-conventional cash flows can produce multiple IRRs or no meaningful solution.
Does this calculator provide financial advice?
No. It applies the stated formula to your inputs for educational planning. Validate definitions, timing, accounting treatment, and assumptions before acting.