2018 IRS extension

I prepared an extension for a client on April 16, 2018. I e-filed the extension with a balance due of $ 13,000 to be debited to a taxpayer checking account. The extension was rejected reason being an extension was already filed on April 6, 2018 with a zero balance due. Client has no idea who would have filed an April 6th extension.
I contacted the IRS e file help desk and they would not tell me who filed the extension. I later had the client call but the IRS would not tell him who filed the extension.
I would think that a E -file submission would have an EFIN # so that the IRS could determine who filed the return.

Has any one had a similar situation when e filing an extension ?

I've had this happen a few times this year, and in each case it was either the client (not in your case, obviously), or the prior preparer. Was this a new client? Someone else in your office that got gun shy and filed it so it wouldn't be missed....this happens in my office sometimes.

ID Theft comes to mind, but I can't think of someone committing ID theft on a client so they can file an extension....unless they were nice thieves...

Perhaps an honest mistake of someone (DIYer or a professional) filing an extension with a number transposed in the SSN?

I've had this happen. The IRS definitely won't tell you who filed the extension, but they will usually confirm enough information to determine if it's an identity theft issue. For example, they will ask you your client's address. If it doesn't match the address on the extension that was filed first, they will tell you that it doesn't match. Then, they mark the file as an ID theft case. I'm with the others - it could have been a prior preparer covering their bases as a professional courtesy.

I know some CPA firms file extensions in the first week of April for all clients whose tax returns have not been filed, no matter whether the client is coming back or not. They did not even take time to call clients. The cost for additional tax extension filing is almost zero since the firm filed extensions on paper and mailed it out in one envelope. Why would they bother to make a call?

The firm I worked for years ago, efiled extension for a client, without contacting taxpayer. The extension was rejected because his tax return had been efiled and accepted. We then realized the client walked away from us.

I think it is possible just an honest clerical mistake as long as no tax return was filed and tax refund was claimed and deposited by an unknown party.

How can you file an extension without client approval?

Several years ago I had a client whom I had not heard from in over a year, and had not sent me his prior year info after asking me for an ext for that prior year. I sent him one email about extending him for the current year and didn't hear back. So I didn't file an ext.

A month later he emails me to say he'll be sending me his info for both years. I told him I did not file ext for current year. He asked me why when he'd been my client for years. End of story he had made a killing in the stock market for the current, owed a boatload, got hit with big failure to file penalties etc.

How can you file an extension without client approval?

Where does it say preparer needs taxpayer approval for filing an extension?

How can you file an extension without client approval?

Where does it say preparer needs taxpayer approval for filing an extension?

Where does it say you can? Filing an extension extends the time for IRS to audit a return by 6 months.
I would never do it without at least an oral authorization.

How can you file an extension without client approval?

Where does it say preparer needs taxpayer approval for filing an extension?

Where does it say you can? Filing an extension extends the time for IRS to audit a return by 6 months.
I would never do it without at least an oral authorization.

The statute of limitations doesn't work like that.

It's, primarily, a risk mitigation move. If client ends up coming back and no extension has been filed, you've just saved them FTF penalties. If they've already filed, no harm done.

How can you file an extension without client approval?

You beat me! I have the same question. The boss said it never hurts clients if he filed extension. Some of his clients left him but he did not know until the client never showed up. Some of his clients did forget about income tax returns. Can you believe that?

I always contact the client directly concerning filing an extension.
I would never file an extension without client approval.

The boss said it never hurts clients if he filed extension.

The OP indicates some potential harm.

Kip Dellinger states filing w/o client approval is a 230 violation. Some of his comments are in this post: viewtopic.php?p=34831#p34831

Ed Zollars gives this example where filing an extension caused harm:

"In the case in question the taxpayer filed a bankruptcy petition and the question became whether the penalties were dischargable ( United States v. Wilson, DC ND Cal., Case No. 3:15-cv-04118 reversing Wilson v. United States, Case No. 14-1106 (Bankr. N.D. Cal) ).

The taxpayer's return for 2008 was due on April 15, 2009. An extension was filed (moving the date to October 15, 2009). On July 12, 2012 the taxpayer filed his bankruptcy petition.

Generally tax penalties can be discharged in bankruptcy only if "imposed with respect to a transaction or event that occurred before three years before the date of the filing of the petition." So a key question became--what is the date to start measuring the three years.

The bankruptcy court had decided 4/15/09 was the date (which would have made it dischargable), but the District Court, on appeal, found that due to the extension, the event in question as his failure to file a return by 10/15/09, which was less than three years before the date in question.

As you might imagine, things could get interesting if the preparer had filed for that extension and doesn't have a record of the taxpayer's approval of that action."

So damned if we do, damned if we don't. Funny, you are supposed to estimate tax liability on the extension for it to be valid....although I am sure none of us have ever had one denied. So if you have no contact with the client and are just filing them, they must have all zeros??

I generally call/email every client to make them aware they are going on extension and ask them to at least get me W-2's. I start this process generally the Monday before the due date. Then I start filing them a few days before the deadline. But I have some clients that I know just want extensions every year, so I just file them......and yes with zeros.

Most of my extensions are zeros. The one exemption was a schedule C client who never sends in estimates and hadn't filed a return in 13 years. I don't believe they ever paid the balance on that return.

Just to echo what someone posted, if this is a new client for you there is a possibility that the prior preparer may have filed the extension without the taxpayer's knowledge. i experienced a similar situation few years back and it was because the taxpayer totally ignored the prior preparer's calls (for personal reasons) and came to me but the prior preparer thought he would be doing her a favor by filing an extension.

If the taxpayer calls the IRS and raises an identity theft issue, IRS will issue a PIN for the following tax year.

The prior CPA firm ( which is a large firm) claims that they DID NOT E-file an extension for my new client. What I find interesting is the IRS E-file help desk will not give my client any information concerning who filed the extension. The E-filed extension would have an EFIN so the IRS knows who filed the extension.

Maybe the extension filed on 4/6 wasn't filed electronically. Or maybe you give the IRS computers too much credit.

Point taken about 'potential' harm from filing extension without client contact... although it seems like a very rare situation where harm could be caused. I guess the taxpayer could argue the extension was invalid assuming it showed zeros.

An extension is not rendered invalid because it contains zeros. Zero can very probably be a diligent and proper estimation of the tax that will be due.

The extension was filed with IRS without client approval by another accountant. The client estimated a balance due with the extension however the extension that was filed 2 weeks earlier was filed by someone showing a zero tax which is incorrect. IRS refuses to provide to the taxpayer information concerning who filed the extension.
The actual 1040 was E-filed with payment due last week.