IRS code 196: Interest charged for late payment
Quick answerInterest the IRS charged on tax that wasn't paid by the due date. Interest is set quarterly and compounds daily until the balance is paid.
Transcript code196
MeaningInterest charged for late payment
Action needed?Yes — see steps
What happens next
Posts whenever the IRS calculates interest — usually with a notice or when the account is updated.
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What you should do
- Pay the balance to stop interest growing
- Interest is generally only removed if the underlying tax or penalty is removed
- Use our penalty & interest calculator to estimate the total
Frequently asked questions
What does IRS code 196 mean?
Interest the IRS charged on tax that wasn't paid by the due date. Interest is set quarterly and compounds daily until the balance is paid.
What should I do?
Pay the balance to stop interest growing Interest is generally only removed if the underlying tax or penalty is removed Use our penalty & interest calculator to estimate the total
How long does it take?
Posts whenever the IRS calculates interest — usually with a notice or when the account is updated.
Sources
- IRS: Understanding your IRS notice or letter
- IRS: Get Transcript
- Taxpayer Advocate Service (independent help inside the IRS)
Written by the editorial team and checked against the official sources above. See our editorial policy.
By the TranscriptCodes Editorial Team · Last reviewed 2026-11-12.