IRR Calculator
IRR of comma-separated cash flows (year 0 first).
Inputs
Result
IRR18.03%
About the IRR Calculator
The IRR (Internal Rate of Return) Calculator finds the annualized discount rate that makes the net present value of a stream of cash flows equal to zero. It is the standard way to evaluate investments with irregular cash flows.
Calculation method
IRR is solved iteratively (bisection or Newton's method) because there is no closed-form solution for more than 2 cash flows.
0 = Σ CF_t / (1 + IRR)^t — solved numericallyHow to use this calculator
- Enter the initial outflow as a negative number in year 0.
- Enter each subsequent inflow (or outflow) in order.
- The tool returns the annualized IRR.
Example
Cash flows of −$10,000, +$3,000, +$4,000, +$5,000, +$2,000 over 4 years give an IRR of about 15.6%.
Frequently asked questions
IRR vs. NPV — which should I use?
Use NPV to rank mutually exclusive projects; use IRR when you need a single rate to compare with a hurdle rate or cost of capital.
Can IRR have multiple values?
Yes, when cash flows change sign more than once. Use modified IRR (MIRR) or NPV in those cases.
What is a good IRR?
Above your cost of capital or hurdle rate. Venture capital usually targets 20–30%+; corporate projects often aim for 12–15%.
Disclaimer: This calculator is for informational and educational purposes only and does not constitute financial, tax, or legal advice. Consult a qualified professional for decisions specific to your situation.