Modified Internal Rate of Return Modified internal rate of return (MIRR) is a capital budgeting tool which allows a project cash flows to grow at a rate different than the internal rate of return. Internal rate of return is the rate of return at which a project's net present value (NPV) is zero. ‘Present Value of Negative Cash Flows at the Finance Rate’ is present value of each cash flow at the finance rate. Example. Using a finance rate of 3% and a reinvestment rate of 2%, find the MIRR of: Period 0: 2,000, Period 1: -50,000, Period 2: -35,000, Period 3: 10,000, Period 4: 100,000, Period 5: -5,000. Meanwhile, the internal rate of return (IRR) is a discount rate that makes the net present value (NPV) of all cash flows from a particular project equal to zero. Both MIRR and IRR calculations rely on the formula for NPV.