Late filing

[Black Bart]

Can't remember this: When you've extended to October 15th and then don't file by that date; is the late filing penalty figured from October 15th forward or does it revert back to April 15th and the penalty figured from there?

[erchess]

I don't have a cite

but I think your extension becomes null and void and everything is as if you had not filed it unless of course you apply for and are granted another extension.

[Kram BergGold]

4/15

Penalty figured from 4/15. There are no additional extensions past 10/15.

[JohnH]

Are you sure about that? I thought the extension automatically pushed the due date of the return to the extended due date, so if it is filed after Oct 15 the FTF penalty would begin to run on Oct 16 at 5% per month. The FTP & Estimated Tax penalty apply back to Apr 15, but they would apply even if the extended return is filed before Oct 15.

[JON]

Individual returns

if your not 90% paid in the IRS can always say the extension not valid and penalties-all- go back to 4/15. Failure to file penalty kicks in automaticly after 10/15.

[JohnH]

You might want to double-check that.

The 90% rule has nothing to do with the validity of the extension - all that is required is that you "Properly estimate your 2007 tax liability using the information available to you", whatever that means. You don't even have to pay any of the tax due for the extension to be valid, as long as you estimate it correctly.

The 90% rule applies only to the small FTP penalty, not the monster FTF penalty.

[okie1tax]

Well, someone please find the authority on this. I've tried every phrase I could think of to search and the only thing I can come up with is that if you don't file a return, you are subject to the penalty. Nothing about extensions gives anything except that you should pay any taxes due to avoid that penalty.

[okie1tax]

In the case of a failure to file a return of tax imposed by chapter
1 within 60 days of the date prescribed for filing of such return
(determined with regard to any extensions of time for filing),
unless it is shown that such failure is due to reasonable cause and
not due to willful neglect, the addition to tax under paragraph (1)
shall not be less than the lesser of $100 or 100 percent of the
amount required to be shown as tax on such return.
Sec 6651

[okie1tax]

Still don't think this answers the original question.

[veritas]

Yo BB

Can't remember this: When you've extended to October 15th and then don't file by that date; is the late filing penalty figured from October 15th forward or does it revert back to April 15th and the penalty figured from there?

The late filing penalty is computed from the 10-15 date.

So what was Barkley's answer?

[Black Bart]

Vote?

The late filing penalty is computed from the 10-15 date.

Maybe we should try the scientific method and take a vote -- that should settle the matter once and for all. So far we've got three 4-15s (Erchess, Kram, Jon), two 10-15s (you and John H), one unsure (Okie), and one clueless (me).

So what was Barkley's answer?

Senator Barkley's unavailable for comment on that, but I read the full story on his quote (from Chris Matthews' book: Hardball). It's about the notoriously short memory of the voters. Here it is:

When that rural voter told Barkley (later, Harry Trumann's vice-president) he might vote for his opponent, Governor A.B. "Happy" Chandler, the senator reminded him of the many things he had done for him as an attorney, county judge, congressman, and senator. He'd visited him in a military hospital when he was wounded in the war, helped him get his veteran's benefits, arranged his loan from Farm Credit, and gotten him a disaster loan when a flood destroyed his home. He asked "How can you even think of voting for Happy? Surely you remember all these things I have done for you!"

"Yeah," his voter said, "I remember. But what in hell have you done for me lately?"


___________________
"What have you done for me lately?"
-- Rural constituent's question to Kentucky Senator Alben W. Barkley/1938 reelection campaign.

[okie1tax]

In case of failure -
(1) to file any return required under authority of subchapter A
of chapter 61 (other than part III thereof), subchapter A of
chapter 51 (relating to distilled spirits, wines, and beer), or
of subchapter A of chapter 52 (relating to tobacco, cigars,
cigarettes, and cigarette papers and tubes), or of subchapter A
of chapter 53 (relating to machine guns and certain other
firearms), on the date prescribed therefor (determined with
regard to any extension of time for filing), unless it is shown
that such failure is due to reasonable cause and not due to
willful neglect, there shall be added to the amount required to
be shown as tax on such return 5 percent of the amount of such
tax if the failure is for not more than 1 month, with an
additional 5 percent for each additional month or fraction
thereof during which such failure continues, not exceeding 25
percent in the aggregate;
I think I will now vote for the 10-15-XX date.

[Black Bart]

Good call, Okie

In case of failure...to file any return...relating to distilled spirits...tobacco...machine guns...on the date prescribed...determined with regard to any extension of time for filing...there shall be added...5 percent of the...tax...with an additional 5 percent for each month...such failure continues, not exceeding 25 percent...

I think I will now vote for the 10-15-XX date.

Since your cite looks to be fresh 19th century legislation and BATFS (Bureau of Alcohol, Tobacco, Firearms, Sex) is apparently with us, I'll take a wild guess and go aong with your view. That make it four to three for October 15th and, I suppose, we may now consider the matter closed.

Ain't the scientific method wonderful? Right here in the midst of all this corporate techo-tax postin' about entities such as Hare, Inc., we've doped out an answer for outfits like Bart's Bunnies.

[OtisMozzetti]

Consensus says lateness is from 10/15, but two cautions

Apparently there is a consensus that the Failure to File Penalty is based upon the months or portions of months late filed after the extended due date 10/15. Yet, there are two cautions:

1. You cannot simply say it is "computed from 10/15". It says in 4868 instructions that the penalty is based upon the tax not paid by the due date (without regard to extensions). In other words, the taxpayer cannot between 4/15 and 10/15 bring up his estimate of the tax liability in order to keep down the amount of the failure to file penalty.

2. It also says that "if [the IRS] later finds that the estimate of tax liability [made with Form 4868] was not reasonable, then the extension will be null and void." If that happens then, then the Failure to File Penalty goes all the way back to the original due date.

[Black Bart]

Okay, but

Apparently there is a consensus that the Failure to File Penalty is based upon the months or portions of months late filed after the extended due date 10/15. Yet, there are two cautions:

1. You cannot simply say it is "computed from 10/15". It says in 4868 instructions that the penalty is based upon the tax not paid by the due date (without regard to extensions). In other words, the taxpayer cannot between 4/15 and 10/15 bring up his estimate of the tax liability in order to keep down the amount of the failure to file penalty..

we're agreeing (aren't we?) that, assuming you had either paid the tax before 4-15 or sent all of it with the extension, then the FTF penalty would not begin 'til 10-15?

2. It also says that "if [the IRS] later finds that the estimate of tax liability [made with Form 4868] was not reasonable, then the extension will be null and void." If that happens then, then the Failure to File Penalty goes all the way back to the original due date

I've read about this before, but I have never yet seen it done and think chances of it being imposed are extremely low.