Enter a project's yearly cash flows to find its IRR, its NPV at your discount rate, and the modified IRR. Calcist finds every IRR, not just one, and warns when IRR can't be trusted.
NPV and IRR
Net present value discounts each year's cash flow back to today and adds them up. Year 0 is today, so it isn't discounted:
NPV = CF₀ + CF₁ ÷ (1 + r) + CF₂ ÷ (1 + r)² + … + CFₙ ÷ (1 + r)ⁿ
The internal rate of return is the discount rate that makes NPV exactly zero. There's no formula for it, so Calcist scans rates from −99% to 10,000% for every point where NPV changes sign, then narrows each one down by bisection to well under 0.0001%. That's why it can report two IRRs when they exist, where a spreadsheet's IRR shows just one.
Note: Excel's NPV function treats the first value as one period away. Calcist's NPV counts year 0 as today, which is the usual textbook definition.
Worked example
A $70,000 investment returns $12,000, $15,000, $18,000, $21,000 and $26,000 over five years. The IRR is 8.66%. At a 10% discount rate, the NPV is −$2,683.31: the project earns less than 10%, so it falls short of that hurdle.
When IRR misleads: use MIRR or NPV
- More than one sign change. If cash flows go negative, then positive, then negative again (like a cleanup cost at the end), there can be two IRRs or none. −100, +230, −132 has IRRs of both 10% and 20%.
- Reinvestment. IRR quietly assumes money coming in is reinvested at the IRR itself. MIRR uses a realistic reinvestment rate instead, and a finance rate for money going out:
MIRR = (FV of inflows at the reinvestment rate ÷ PV of outflows at the finance rate)1/n − 1
Microsoft's example: −$120,000, then $39,000, $30,000, $21,000, $37,000 and $46,000, with a 10% finance rate and 12% reinvestment rate, gives a MIRR of 12.61%, against an IRR of 13.07%.
- Comparing projects of different sizes. A small project can have a higher IRR but add less value. When choosing between projects, prefer the higher NPV.
This is a planning estimate, not financial, tax or investment advice.
Sources
How we checked this
Before every update, this calculator is run in a real browser with these known answers, and it must match all of them:
- −70,000 then 12,000, 15,000, 18,000, 21,000, 26,000: IRR 8.66% ✓
- Same flows: NPV at 10% is −$2,683.31 ✓
- −120,000, 39,000, 30,000, 21,000, 37,000, 46,000: MIRR 12.61% (10% finance, 12% reinvest) ✓
- −100, 230, −132 has two IRRs: 10% and 20% ✓
- All positive cash flows: no IRR ✓
Last checked October 26, 2026. Spotted something wrong? The math is done in your browser with the formula shown on this page, so you can check any result by hand.
Questions people ask
What is IRR?
The yearly return a project earns on the money tied up in it: the discount rate at which the cash flows' net present value is zero.
What is a good IRR?
One above your cost of capital or hurdle rate, the return you could get elsewhere at similar risk. If the IRR is higher, NPV at that rate is positive.
What's the difference between NPV and IRR?
NPV is a dollar amount: how much value the project adds at your discount rate. IRR is a percent. They agree on yes/no for simple projects, but NPV is more reliable for choosing between projects.
Why does it say there is more than one IRR?
When cash flows change sign more than once, the NPV curve can cross zero more than once. Each crossing is a valid IRR, so IRR alone can't rank the project. Use NPV or MIRR.
Why is there no IRR?
If all cash flows have the same sign, or NPV never reaches zero at any rate, no IRR exists. NPV still works.