IRR Calculator — Internal Rate of Return Calculator for Cash FlowsNPV = 0 at IRR · Capital Budgeting · MIRR · Payback Period · DCF Analysis
Use this free IRR Calculator to compute the Internal Rate of Return (IRR) of any investment or project — defined as the discount rate at which the Net Present Value (NPV) of all projected cash flows equals exactly zero. Enter your initial investment (Year 0 cash outflow) and up to multiple years of projected annual cash inflows to automatically calculate: IRR percentage (%) · Net Present Value (NPV) at your hurdle rate · Modified IRR (MIRR) with reinvestment rate · investment payback period (years) · cumulative discounted cash flow (DCF) schedule — giving you the complete capital budgeting analysis toolkit in a single calculation. An IRR above the cost of capital (WACC) signals a value-creating investment; an IRR below WACC indicates value destruction.
The Internal Rate of Return (IRR) is the most widely used investment profitability metric in corporate finance and capital allocation, applied across every major class of financial decision-making: capital budgeting & CapEx project evaluation — machinery, plant & equipment · private equity & venture capital fund IRR calculation · real estate investment & rental property IRR analysis · infrastructure & project finance — roads, energy & PPP deals · startup equity valuation & venture IRR hurdle rate comparison · bond yield-to-maturity (YTM) & fixed income IRR equivalence. Trusted by investment bankers, CFOs, private equity analysts, CFA charterholders, financial controllers, project finance teams, SEBI-registered investment advisors (RIA), and MBA finance students for rigorous discounted cash flow (DCF) analysis, investment feasibility studies, and capital allocation decision support.
⚠ Financial Disclaimer: This IRR calculator is intended for educational and financial planning purposes only. IRR has well-documented limitations including multiple IRR problem with non-conventional cash flows, implicit reinvestment rate assumption at IRR (addressed by Modified IRR — MIRR), inability to reflect investment scale or absolute value creation, and sensitivity to terminal value assumptions. Always compare IRR against NPV, MIRR, Profitability Index (PI), and your organization's Weighted Average Cost of Capital (WACC) hurdle rate before making capital budgeting or investment decisions. Consult a licensed CFA charterholder, investment banker, or certified financial planner (CFP) for high-stakes project finance or M&A valuation work.You can also explore our financial calculators or use our developer tools for advanced workflows.
Annual Cash Inflows ($)
Related Finance & Investment Calculators
IRR Calculator — The Discount Rate That Makes Your Investment Break Even in Present Value
Internal Rate of Return is the discount rate at which an investment's net present value equals zero — the breakeven return rate. An IRR of 15% means the investment returns exactly 15% annually on the invested capital. If your cost of capital is 10%, an IRR of 15% represents a worthwhile investment; an IRR of 8% means the investment returns less than your cost of capital and destroys value. Private equity funds typically target 20-25% IRR; real estate development projects target 15-20%; conservative infrastructure investments may accept 8-12%.
IRR is computed iteratively — there is no closed-form solution. The algorithm tries discount rates until the NPV of all cash flows sums to zero. The IRR calculator implements Newton-Raphson iteration with multiple starting points to find the solution quickly and to detect multiple IRR situations. Cash flow streams that change sign more than once can have multiple valid IRRs, which makes interpretation ambiguous. The calculator flags this condition and presents the Modified IRR (MIRR) as an unambiguous alternative.
IRR assumes interim cash flows are reinvested at the IRR itself — an optimistic assumption that inflates the apparent return for high-IRR projects. Modified IRR (MIRR) corrects this by assuming interim cash flows are reinvested at the cost of capital (more realistic) and that financing costs apply at the financing rate. A project with 30% IRR might have 20% MIRR when realistic reinvestment assumptions are applied. The calculator computes both, letting you choose the metric that best reflects your actual reinvestment opportunities.