I missed one - ugh!

[schirallicpa]

Without a secretary working for me (since I lost my assistant when Covid started because she has some other health issues, and can not find a replacement because unemployment is too good) I was in a frenzy last week trying to make sure I had extended everyone I needed to extend.  But I missed one.  I had his return done for him, but he had not been able to get efile papers signed and back to me (married and wife did not come in with him).  I should have automatically set up extension.  I don't know how I forgot him.  I sent him on Friday.  Hope they don't notice........right........ugh.........and he had 2 states........boo......

[Yardley CPA]

It happens.  We're human.  We're all dealing with this crazy environment right now and doing the best we can.  Don't beat yourself up. 

 

[Possi]

That's right. We all do that. We just don't realize it until NOVEMBER! LOL

[Abby Normal]

None of states I deal with have late filing penalties, only late paying penalties. And refund returns don't need extensions anyway.

For science, try to efile the federal extension now and report back to us.

[ILLMAS]

How do you respond to this: 

Very close to filing deadline

”Here is my information and I would to file before the deadline to avoid having to pay fines and penalties”

You:  you have tax returns you received in May still in queue to be prepare.

[BulldogTom]

42 minutes ago, ILLMAS said:

How do you respond to this: 

Very close to filing deadline

”Here is my information and I would to file before the deadline to avoid having to pay fines and penalties”

You:  you have tax returns you received in May still in queue to be prepare.

I will do my best.   

Tom
Modesto, CA

[Lion EA]

"I can e-file an extension for you or you can take your information back and look for another preparer."

[RitaB]

On 7/22/2020 at 9:17 AM, ILLMAS said:

How do you respond to this: 

Very close to filing deadline

”Here is my information and I would to file before the deadline to avoid having to pay fines and penalties”

You:  you have tax returns you received in May still in queue to be prepare.

Taxpayer Karen, you can avoid interest and penalties [maybe not entirely if you've not paid quarterly] by paying what you owe now,  before July 15, and here's a Form 1040-ES.   I will get you an extension today, and prepare your return as soon as I am able.  I will complete your return even before my own, provided I have everything needed to prepare yours.  I understand you don't know what you owe; I don't know what I owe either.  That's why I estimate as closely as possible, and pay in quarterly what I think is a little too much.   

[Sara EA]

Sometimes I think it's best to skip a first-quarter estimate and just add that amount to the extension request.  For example, I never know what I'm going to owe either.  I guess $1k and usually pay $2k or so each estimate.  So I pay $3k with the extension.  At least I don't underpay for the year, and what's left over gets rolled to the next year (hopefully close to what the first estimate should have been).  I know a CPA who pays all four quarter estimates with his extension request.  He says that's when his bank account is full with tax season receipts so he might as well.  If he's under a bit, he has time to make it up in a later quarter.

[Lion EA]

I always calculate extension payments for my clients to include both the balance due for the old year plus the new year's 1Q and 2Q ES payments, using the safe harbor and rounding up generously. Then, when we finally prepare their returns (maybe in September after that pesky K-1 finally arrives) we're not running behind for the current year. Paying the BD and 1Q and 2Q with the extension instead of separately means they're all dated 15 April (well, 15 July this year) and makes the balance due and 1Q on time and 2Q covered until we can prep the returns. If the payments flow into 2Q and 3Q and even 4Q, that's OK. But, most usually, we catch up (or reduce payments) in 3Q and 4Q. It's so much simpler than trying to calculate exactly how much to pay with the extension and exactly how much to pay with the 1Q voucher and then hustling to prep the returns or calculate exactly how much to pay with the 2Q voucher. 

[WITAXLADY]

you have clients who pay estimates?

We would not have had to have them pay vouchers if they did estimates!!

Maybe I will try the pay 1.2 with tax due method..

D

[Lion EA]

I have them pay federal estimates via IRS's DirectPay and their appropriate state's online system (not mail in with a paper voucher). Don't you have clients who pay estimates? Self-employed, for example?

[Sara EA]

There are the clients for whom we dutifully print ES vouchers every single year, and every year not a single one gets paid even after we have pointed out year after year how much underpayment penalties they paid.  Then there was the new client who used to calculate his own estimates--to the penny.  No kidding, he's pay $3862.18 one quarter and $3542.03 the next.  Most do exactly what we tell them, even writing the check number and date paid on the worksheet.  It does take all kinds.

[Lion EA]

I have a few who won't pay estimates. I don't bother trying to explain estimates to them any more. But if they also have balances due (which they will by not paying estimates) AND go on extension, I do my above method of having them pay enough with the extension to cover 1Q and 2Q ES. That way, at least I have the year front-loaded for them and reduce P&I a bit. IF I can convince them to pay with the extension!

[michaelmars]

Always send the vouchers to the client so they can't blame you for any penalties if they don't get paid.

[Lion EA]

I always send the paper vouchers with a note that I suggest paying online to have confirmation (or this year, to make sure it gets processed any time soon!) and the links. Unless I'm sure they'll pay online, I send vouchers WITH addressed envelopes.