Extension w/Balance Due

[Lion EA]

I'm attacking extensions, more extensions than I've had, ever. Those that owe, I've sent to IRS's DirectPay and their state(s) equivalent sites to make a payment that also files an extension. But those have been just a couple who are computer savvy and are used to making their ES and other payments online. This year I have more, such as new clients I can't fit in until the summer.

Would you send them to DirectPay + State? Then, I don't know if they did it, when, for how much, and most importantly, if they actually clicked on the right items to record a 2021 Extension.

Or would you e-file their extensions yourself, meaning you need a signature for direct debit? I haven't even done that before, an extension payment needing a signature with an e-filed extension.

[Lynn EA USTCP in Louisiana]

I efile the extension,leaving the payment line blank, then send the payment voucher to the client.  It's up to them whether or not they remit the balance due for the extension request.  I explain that an extension is for filing the paperwork, but not for paying the taxes due.

 

[Lion EA]

So, have them mail in checks this week? I'm so reluctant to have anything mailed. That is what I always did in the past, though.

[Lion EA]

Some of my states are NOT allowing me to file extensions with a balance due but NO payment made with the extension. Would you still e-file but claim a zero balance? Then have client mail a check or go on the state website?

Also, one client last year where I had for years e-filed his extension and then he'd go online to pay -- last year he received a letter that his e-payment was a duplicate extension filing and therefore DENIED.

What are all of you doing about extensions with balances due?

[Abby Normal]

Most states accept the federal extension and I've yet to find a state with late FILING penalty. States seem to just have late PAYING penalties and interest.

If you must file the state extension, just show no balance due.

[Lion EA]

That's my concern this year in this very compressed season when I'm putting so many clients on extension, and a bunch of them owe. The easiest -- but not a check in the mail -- way for them to pay what I compute for them. And whether their online payments substitute for me e-filing their extensions. I have about 13 states (FL & TN are no problem) such as CT, NY, MA, PA, IL, CA, CO, SC,...

[Catherine]

MA stopped a couple of years ago accepting extensions without payments. I guess it was just too much paperwork for them. If I don't have debit info and permission for the client I use my portal to send them a payment coupon to print & mail with a check, along with a note to tell me how much they paid.  If they don't do it, it's not my problem. I have enough on my plate without hand-holding grown-ups.

[Lion EA]

My concern isn't whether the clients pay. Mostly long-time clients, so I know the couple who'll be late. My concern is that the IRS, and maybe the states, won't process their extension payments via mailed checks by the time we file their returns. Clients will get letters saying they owe.

One father of child clients laying awake in bed in pain and on meds following hip replacement was so distraught that the IRS was calling him (his kids) a deadbeat that he got up and paid a second time, for both kids. Still not showing up in the kids' accounts, so have no idea how we'll ever get that back, or get it applied to the kids' accounts for next year. Now even grandpa who invests for the kids is unhappy with me, also. I keep hearing from all three generations, and only the two kids are my clients.