Two brothers own a profitable S corporation (60/40). They typically make no personal estimates during the year but make large extension payments (and pay underpayment penalty). For 2018, they decided to make a 4th quarter estimate around March of 2019. We prepared the estimate vouchers and the brothers mailed the vouchers with checks. The 2018 returns have been filed claiming the payments of $150,000 and $100,000.
It has come to light that the vouchers we provided were for 2019, not 2018. It was an error. The IRS is billing the taxpayers for the $250,000 (combined) plus lots of penalties and interest. I contacted the Practitioner Hotline today and was told there is nothing that can be done to move the payment from the 2019 account to the 2018 account because the voucher was for 2019 and the taxpayers indicated 2019 Form 1040-ES on their checks.
Of course, this is a big problem. I am certain it has to have happened before. Has anyone had a similar experience? Do these taxpayers really have to come up with another $250,000 and wait til 2020 to possibly have their money refunded? I considered contacting the Taxpayer Advocate, but, I am not really sure if that would help.