IRS ext and pymt went to NY, and NY ext and pymt went to IRS

[schirallicpa]

Well, here' one way to get a new client.  The previous tax preparer didn't file ext and pymt electronically, but instead gave the client the paper version at the last minute of April 18 and he put them in the wrong envelopes and mailed off.  Well - NYS sent the check and voucher back.  The previous preparer hasn't gotten the return done yet.  He brought the voucher and check to me to mail back out again.

So my question is, should I mail out the check with the now invalid extension, or should I print 1040-V and IT-201-V and mail out his payment with those, even though return not submitted yet?

Just don't want things to get any more messed up for him.

 

[Abby Normal]

You're lucky NY sent it back. MD would have cashed the check and refused to send you a refund. One of my clients did the exact same thing several years ago. so we had a canceled check, made out to the US Treasury but MD had the money.

[Gail in Virginia]

48 minutes ago, Abby Normal said:

You're lucky NY sent it back. MD would have cashed the check and refused to send you a refund. One of my clients did the exact same thing several years ago. so we had a canceled check, made out to the US Treasury but MD had the money.

Virginia would have also cashed the check.

 

[Abby Normal]

MD sends them to a bank box and the bank just slams them.

[SaraEA]

Same thing in CT.  They scan the bottom of the checks, and the scanners don't read the "pay to" line, just the account and routing numbers.  So they get to cash a check made out to "US Treasury."  Now if I tried to cash a check made out to Abby or Gail, how far do you think I'd get?

I think my boss is right:  the clients are getting stupider.  The preparer who dealt with Schirallicpa's client likely chose a paper extension because a payment was being made and s/he didn't have the bank info to electronically pay (or the client didn't have the money in the account at the moment).  Client gets the vouchers, instructions clearly highlighted in yellow, and stuffs the wrong check in the wrong envelope.  I had a client who actually discarded my envelopes, made checks out to the US and state, and hand-addressed two envelopes to the state, which happily cashed them both.  Didn't realize what happened until he got an IRS notice, I asked for copies of the front and back of the US Treasury check, and there it was:  deposited to the state.  He initially blamed me for the mistake, backed off and apologized, and is now my new best friend.

I try to make a habit of never blaming a prior preparer until I know both sides of the story.  Just today I responded to an IRS notice for a client whose preparer she had for decades left all the stock sales off the return (but included the interest and dividends, so I know they had the 1099).  I just said that at the height of tax season when most of us haven't had sleep or food for days, stuff happens.

[RitaB]

19 hours ago, schirallicpa said:

 

So my question is, should I mail out the check with the now invalid extension, or should I print 1040-V and IT-201-V and mail out his payment with those, even though return not submitted yet?

I would use the extension vouchers, but I don't think it would make a bit of difference.  Who knows?  Maybe the one who handles it hasn't slept all week and says, "Eh, automatic extension granted.  Let me get back to Rita's new client asking me to resend notices cause he left them in Scotland and has been trying to get her to give him advice without a notice." 

I am joking, of course, but I don't see how it would matter what you send with the check as long as the tax year is clear.

[Abby Normal]

I'd be afraid the IRS would send both the extension and the check back if you used an extension form. Honestly, I'd have the client come in and use IRS Direct Pay. It will save them penalties and interest because it will post sooner.

[schirallicpa]

"The preparer who dealt with Schirallicpa's client likely chose a paper extension because a payment was being made and s/he didn't have the bank info to electronically pay (or the client didn't have the money in the account at the moment) "

That was not the case - which makes it even more annoying.  The client's info is on file with the preparer, and he's a large enough client that he would have the money in his account.  Regardless of having to make a payment or not, the extension should have been filed electronically.  This is our job - to take care of crap for clients.  When I get my oil changed in my car, I expect the service station to perform the entire job for me, and I do not want to have to do anything but pay them.  Same concept for us, we take care of this for them.

I sent in a 1040-V with his payment, and am hopeful that the preparer does not wait til Oct 15 to get the return done.

[Cathy]

Schirallicpa, Wait...did I just hear you that you "are hopeful that the preparer does not wait til Oct 15 to get the return done"?  Then, if the taxpayer is not going to have you prepare his tax return even though the other preparer didn't do his job correctly with not filing the electronic extension, etc... what in the world are you wasting your time for?  Or maybe not....I hope your fee was extremely gratifying once you collected it before giving the person his 1040-V....as you know it's not over yet as IRS won't send him/her the NYS payment even if it was made out to the NYS Department of Revenue....so you are not through with the client of the MIA tax preparer! Or just be sure to tell the person to have his preparer include the NYS payment in his estimated payment figure he uses on his return....which should have earned you an additional fee for that knowledge.  

Cathy