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Late Filing Penalty - balance paid by extension date?

Technical topics regarding tax preparation.
#1
IDCPA  
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Strangely I can't find the answer to this question for a client. He is still gathering documentation and won't be able to file by the extended deadline. So, he is proposing sending in an estimated payment to cover the anticipated taxes and stop any penalties.

But what impact does this have on late filing penalties? He will be filing late. Will the penalties be charged on the balance from July 15 (normally April 15) through the October 15 payment?

Or will it be on the amount reported on the returns when filed, which would theoretically be a refund based on the estimated payment being made by the extended filing deadline?

As an extreme example, if he was to make an estimated payment in December, and then file the returns, they would show no balance when he files, but there's no way he wouldn't have a late filing penalty.

I suspect, to avoid late filing, payment needs to be made by the extended deadline (if valid extension) even if the returns aren't filed, but I can't seem to confirm.... thus TPT. TIA
 

#2
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I believe this was covered in another thread where I made a similar suggestion, but it was pointed out that the late filing penalty is based on the return due date, so making a late extension or estimated payment will not change the tax due on the due date unfortunately.
Maybe you have cause for first time penalty abatement with this client.
 

#3
IDCPA  
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I found the thread you referenced (from yesterday :) and I now concur this is a failed strategy...

It would appear the late filing penalty continues each month until you file....even if you estimate and pay the balance.

Thanks for pointing me in the right direction.
 

#4
Jake  
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But late filing incurs no penalty IF you don't owe any taxes, right? Years ago I had a client with several years of late filings. Only downside I remember was the client did not get the refund he was due on the oldest year.
 


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